KUWAIT CITY, July 6: According to an investigative report conducted by the daily, rents of apartments in Kuwait have dropped by up to KD 100 in various areas depending on several factors related to the location and type of the apartment.
In this regard, the Secretary General of Real Estate Union Qais Al-Ghanim said, “Any increase in the rent of accommodation in Kuwait has completely stopped. In fact, it is currently difficult to talk about increasing rents”.
He affirmed that the rents have dropped but it is difficult to determine the reduction rate if it is more or less than one-third, as every area is governed by different factors in this regard.
Al-Ghanim explained that Salmiya area has witnessed some reduction in rents although it is not possible to determine the exact rate due to lack of official statistics. Riggae area continues to maintain its rent value due to its proximity to military establishments and health areas as well as several active areas in the country.
In Sulaibikhat, the rents have dropped due to its location, which is far from active areas. He revealed that in areas like Sulaibikhat, an expatriate can find a big apartment for about KD 250 per month, indicating that it will be possible to estimate the reduction rate of rent value in September due to the fact that it coincides with resumption of work after the summer holidays.
Al-Ghanim affirmed that increasing the fees and service charges for expatriates have created more financial pressure on them; this has led significant number of expatriates to send their families back to their countries.
He said, “Further pressure on expatriates in terms of cost of living is automatically followed by reduction in the rents of commercial and investment residential real-estates”. Al-Ghanim explained that the landlords will definitely be impacted negatively if the trend of expatriate families returning back to their countries continues.
This will also affect the economy, as money transfers outside the country will increase because the breadwinner of the family is residing in the country and all of his/ her expenses will significantly drop.
This will in turn negatively affect the retail market. He said the union is unable to impose a certain rent value on the landlords due to their different circumstances and responsibilities, which dictate them to set the rent value in a manner that is comfortable for them and will not inflict any commercial losses for them.
Al-Ghanim concluded by saying it is difficult to depend or rather endorse the official statistics on vacant apartments, which claim there are about 104,000 empty apartments.
The reason is that such statistics are not very accurate, given that there is continuous increase in the number of residential buildings and expansion in the residential real-estate market.
According to the statistics report issued by the Public Authority of Civil Information (PACI), the number of empty apartments reached 103,984, and the number of occupied apartments was 203,233, as of end of December 2016.
By Najeh Bilal Al-Seyassah Staff