The Arab Times spoke with several real estate experts and researchers regarding the future of residential real estate in light of the new legislative changes. Real estate expert Alaa Behbehani believes that assessing the impact of the law restricting the monopolization of vacant land on the real estate market must begin by distinguishing between different types of real estate, noting that conflating them can lead to inaccurate conclusions. He emphasized that residential real estate in Kuwait continues to serve as a hedge against inflation, describing the law’s impact as limited.

Behbehani explained that the law does not address the core issue of the imbalance between supply and demand. Price increases are likely to continue, and may even accelerate, so long as the allocation of land and housing projects fails to keep pace with the rapidly growing housing demand and the actual needs of citizens. Real estate in Kuwait has never been limited to residential use alone but has evolved over the years into a tool for speculation and income generation for a large segment of the population. This is a consequence of the rentier nature of Kuwait’s oil-dependent economy, where liquidity is injected into the market through salaries and government projects, in the absence of real productive investment channels capable of absorbing capital.

First is the lack of a diversified, productive economy with industries and companies offering significant investment potential as viable alternatives. Second is the continued strong demand for housing and real estate investment, which makes real estate a safe haven for preserving and even increasing savings. The law regulating the monopolization of vacant land is still in its early stages, and its impact cannot be fully assessed until the seriousness of its implementation and the strictness of government oversight are tested. Behbehani predicted that some affected parties may pass the costs of fees and taxes onto final sale prices, potentially driving further price increases, indicating that others might convert their land into rental units in response to high demand for rentals. He suggested allowing landowners with plots larger than 15,000 square meters to develop their land through regulatory exemptions granted by Kuwait Municipality, which could involve building modern townhouses or establishing fully serviced residential areas.

Behbehani believes this approach serves the interests of both citizens and landowners, and offers a practical solution to the housing crisis. Meanwhile, real estate researcher Fawaz Al-Maimouni stressed that the vacant land fees law is not an isolated measure but part of a comprehensive legislative framework aimed at addressing long-standing deficiencies in the housing sector. He emphasized that vacant land is only one manifestation of these issues, not the primary cause. Al-Maimouni explained that the real estate market is currently experiencing a period of stagnation and uncertainty, reflected in a noticeable reluctance to buy, even among investors. This slowdown represents a shift of capital toward other real estate sectors, particularly investment properties, which are less affected by these laws.

Residential real estate has been one of the highest-yielding investment fields for over twenty years. However, this massive influx of capital has distorted the original residential purpose of model areas, turning residential real estate into a form of investment property driven primarily by the pursuit of high returns. Residential real estate is no longer a safe haven in the traditional sense, as its economic returns have become uncertain and increasingly threatened by new regulations. The market is currently in a phase of stagnation and waiting, followed by a second phase that is beginning to take shape, marked by a growing shift toward investment-focused real estate.

Al-Maimouni emphasized that the completion of the legal framework, along with the finalization of the Kuwaiti- Chinese agreement to develop at least 170,000 housing units, could transform the residential sector entirely, resulting in lower returns and a fundamentally different character. He predicted that the residential sector may experience an unprecedented transition from long-term investment to medium- term or short-term investment, with returns potentially approaching those of stocks or bank deposits. On the other hand, real estate researcher Abdulrahman Al-Hussainan believes that residential properties continue to serve as a safe haven, noting that recent laws have not disrupted the market but have instead provided greater clarity for buyers.

Al-Hussainan stated that demand for residential properties has actually increased since the law’s enactment, with significant individual transactions recorded, indicating that the market is functioning normally. He predicted that mid-2026 would see better performance compared to the previous year. Al-Hussainan explained that real estate remains the best avenue for investing money compared to the stock market or bank deposits. Real estate trading is more stable and speculation in the sector continues to yield positive results. Investors who focused on investment properties while awaiting the housing laws capitalized on opportunities for speculation and trading, making 2025 a busy year for the sector, marked by significant transactions and large deals