Unrest in Bahrain keeping the real estate market subdued in certain locations, it is suggested
There has been an upturn in the number of new expats settling in Bahrain, specifically in the oil and gas industry, which has resulted in companies taking on multiple villas and driving down prices, according to the latest real estate report from Cluttons.
The company, which has specialised in the Middle East markets since 1976, said, however, that demand in the market is not as strong as it was pre-2011 and rents are only being kept flat due to the lack of new properties coming to the market, with many of the larger projects being delayed or put on hold.
In its first quarter report on Bahrain’s residential market is says that there is some price stability in popular areas such as Amwaj, Jasra, Hamala, Saar and Janabiya, and well maintained compounds with good facilities and security are proving to be more popular than individual villas.
However, some apartments in even the most popular areas have experienced falls in rent of 6.25% compared with 2010. Other areas have suffered more significant losses due to their close proximity to perceived areas of unrest.
Rents have started to stabilise, but this is partly due to the lack of new properties coming on to the market, as many of the larger projects are being delayed or put on hold, the report points out.
The sales market is quiet, with the majority of sellers refusing to realise a loss, thus keeping their properties on the market for longer periods. The majority of sales taking place at the moment involve forced sellers who are taking a loss on the originally paid prices. Most sales take place in Riffa Views or Amwaj Islands.
Cluttons predicts that over the next six months the performance of the market will remain very area specific, with the majority of areas experiencing flat to low rental growth.