KUWAIT CITY, Oct 3, (KUNA): A number of real estate experts said here Saturday that there was a visible drop in the price of investment buildings in Kuwait due to a number of geopolitical factors and a pessimistic outlook in general regarding future forecast for real estate in the country. In a number of statements to KUNA, the experts said that the apartments’ prices, whether for rent or ownership, went down in Kuwait, noting that this represented a chance for investors to purchase real estate at its current price.
Tareq Al-Atiqi, a former owner of a real estate company, said that future forecast for investment buildings showed that there will be no increase in prices.
The increase in interest rates in the near future will push for an increase in interest rates for deposits which will eventually lead investors to keep their money in the bank rather than investing in a piece of real estate that might further decrease in price, said Al-Atiqi.
Current owners of investment buildings are decreasing the value of their estate to match with the current economic status quo, said Al-Atiqi, adding that such step was taken to lure possible investors to purchase buildings.
The fact is that earnings of such investments has increased by 7.5 to eight percent, said the expert.
Meanwhile, CEO of Derwazat Al-Safat real estate co Fahad Al-Momen said that despite the decrease in investment buildings value, rents are still stable at their current rates.
He said that the current geopolitical circumstances in the region have led to the current situation, adding that investments in some areas jumped to eight percent compared with figures obtained in 2014.
The prediction is that the prices will remain as they are for investment buildings till the end of the year due to the lack of demand and increase in offer, said Al-Momen.
Meanwhile, Real Estate broker at Al-Nouf international company Khaled Khaja said that fears controlling local bank’s view on the real estate sector disrupts funding operations due to the hike in prices which led to the belief that there was “a new real estate bubble that is about to burst”.
Investors have a chance to buy those properties due to the price decline, said Khaja, predicting more decrease in prices if the interest rates on the Kuwaiti dinar continued and also if interest rates on bank deposits went up.
On his part, sales officer at the Meshkat real estate company Yousef Ellayan said that investors fear that prices would further go down due to the economic and geopolitical situations which in turn drive investments away from real estate in general.
He claimed that investment buildings currently constructed in several areas are not up to the sought standard, noting that was also a factor in keeping away investors from purchasing real estates.