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KUWAIT CITY, June 20: Real estate experts say that the speculators crowding out citizens in private housing is driven by the demand for the double return achieved from licenses for the cost of electricity and water prices and renting their properties in the unit system, considering that this behavior has ignited prices to record rates, which necessitates intervention to stop it to ensure the safety of real estate transactions in this sector, away from any price bubble, reports Al-Rai daily. The sources pointed out that the corona crisis caused significant price jumps in private housing prices, reaching 20% during 2021, driven by the large funds that investors and speculators withdrew from investment and commercial housing after it showed additional attractiveness during the crisis.
It seems that what was presented by the daily published under the title ‘Electricity with (two fils) in one house only’, tested the deep waters, according to citizens affected by the private housing crisis and real estate experts who warned of the repercussions of the continuation of speculation on residential real estate in order to demand a comfortable return even if it was not worth it. Interacting with what was published by the daily, the large liquidity available in the market, especially in light of the decline in deposit returns in local banks, opened the appetite of investors for the great demand for private rented housing and speculation on it, thanks to the higher return, especially after the increase in the construction percentage from 150 to 210.
In addition, the continuation of subsidizing electricity and water tariffs in the residential sector, even on the second, third and fourth houses, encouraged speculative spirit in this sector, especially amid the leniency in dealing with its violations, saying in light of these data, it has become remarkable the spread of divided residential houses similar to buildings, after many of the owners of these plots resorted to renting them to families and sometimes to dozens of bachelors in one apartment.
In this regard, the real estate businessman, Qais Al-Ghanim, said that the state closes its eyes to many violations that occur in private housing until some typical areas have been turned into rentals, wondering: How can the Municipality allow the owners of plots of 750 square meters to convert them into a large number of studio apartments without supervision that house dozens of bachelors in the midst of model Kuwaiti areas? He also defended the question about how to deliver electricity and water to these violating homes?