Real estate experts have ruled out that the collapse of the residential real estate prices was result of the current decline in oil prices, considering the main reason for such collapse was the increase demand and tight supply in the real estate market.
The experts said in separate interviews with Kuwait News Agency (KUNA) on Monday that the real estate market will not witness sharp declines in prices, expecting stable or slight plunge in light of the lack of supply of residential real estate and even investment ones.
For his part, President of the Real Estate Union Tawfiq Al-Jarrah ruled out imminent “collapse” in the residential real estate prices, saying it might be a “corrective movement” by rates ranging between 10 and 15 percent, indicating that the scarcity of land is a key factor in the stability of prices despite the decline in the price of oil, whose Kuwait’s economy depends on almost entirely.
Al-Jarrah noted that oil is a necessary commodity whose impact on all sectors of the state can not be ruled out, however, the issue of housing include other factors which change effects of the declining oil prices.
He said the housing issue is still suffering from an imbalance, as the number of applications are continuously rising against the scarcity of habitable lands, explaining that any decline in land prices is caused by the lack of speculation and not due to the lack of demand.
For his part, Director General of Al-Attar and Al Sayegh real estate company Hussein Al-Attar said the private residential property has recetly seen price increase, especially in the east Qurain areas (Mesayel, Funaitees and Abu Futaira) following the connection of electricity to aome of the blocs, which led to skyrocketing prices from 245,000 Kuwaiti dinars for the 400 square meters land to 275,000 dinars.
He explained that through his follow-up to market prices continuously, he did not find any “scary” descent to be considered an index slope of prices, noting that there are some speculators who want to reap profits, even with less than the previous margin through reducing the price of the land between kd 5,000 to 10,000 in order to tempt buyers and then search for other between opportunities.
Source : KUNA Kuwait News agency
