Peace prospects fuel optimism across Kuwait property sector

KUWAIT CITY, June 17: With the easing of military tensions in the region and the beginning of a new phase of relative calm, the future of the Kuwaiti real estate market is tied to the stability of the geopolitical situation and the political and economic agreements expected to emerge in the coming months. Although real estate experts agree that an end to the war between the United States and Iran would help boost confidence and support liquidity inflows into the market, they emphasized that caution and a wait-and-see approach will continue to dominate the current period until the situation becomes clearer.

He stressed that many companies postponed their real estate investment decisions during the past period due to geopolitical tensions, adding that the return of investment activity will depend on the success of the ongoing negotiations and the achievement of a stable agreement.

Al-Faraj emphasized that the real estate sector would be the main beneficiary if stability is achieved, particularly with the expected revival of government and infrastructure projects and increased demand, adding that a decrease in geopolitical risks would first support the return of local liquidity and subsequently attract foreign investment into the Kuwaiti market. He affirmed that the recent crisis prompted many investors to reassess their investment priorities, with a stronger trend emerging toward real estate investment within Kuwait, as it is considered safer and easier to manage during crises compared to foreign real estate.

Al-Faraj predicted an improvement in activity and liquidity during the last quarter of the year if a final agreement is reached between Iran and the United States. Meanwhile, real estate expert Badah Al-Dousari said the Kuwaiti real estate market is expected to witness relatively positive effects during the second half of 2026 with the return of regional stability. He explained that the period of geopolitical tensions led many investors to postpone purchase and investment decisions, which was reflected in a decline in transaction volumes and values during the first quarter of the year. The return of stability will gradually contribute to boosting investor confidence and directing liquidity into the real estate market, supported by the continued growth of non-oil activities and anticipated reforms, most notably the housing finance law.

The residential sector is expected to benefit the most in the short term, given the accumulated demand for housing and the rising number of housing applications, in addition to the expected role of housing finance in enhancing citizens’ purchasing power. Residential real estate accounts for approximately 49 percent of total market transactions. Investment real estate has strong growth potential in the coming period, benefiting from the return of liquidity and continued improvement in rental and price levels. Al-Dousari also predicted that the commercial and industrial sectors would benefit more in the medium term, supported by infrastructure projects, economic development, and New Kuwait 2035 vision. Furthermore, real estate activist Basma Al-Sultan stated that the military tensions negatively affected the real estate market, particularly leading to a decline in land prices, which created investment opportunities that were seized by a large number of buyers and investors.

The decline did not result in a lack of demand; on the contrary, some sectors, especially land, chalets, and livestock pens, witnessed a noticeable increase in purchasing activity driven by lower prices and investors’ desire to capitalize on opportunities. Al-Sultan said a cessation of hostilities and a return to stability would significantly restore confidence in the market. She anticipates that real estate transactions will regain momentum in the coming period, potentially even reaching levels exceeding those seen before the crisis. In addition, real estate activist Yousef Al-Safran confirmed that the Kuwaiti real estate market maintained its activity and stability during the first half of 2026, despite regional circumstances and tensions. He noted that Kuwaiti investors demonstrated continued confidence in the strength of the national economy, the government’s approach, and its ability to overcome challenges.

Al-Safran indicated that any positive impact from the current stability could be influenced by anticipated real estate legislation that is still under review. He stated that the enactment of some of these laws during the second half of the year could affect the volume of real estate transactions and overall market trends. Al-Safran pointed out that the residential sector will benefit most from the post-war period, as it is the sector most closely linked to citizens’ needs. He predicted an increase in residential activity with the stabilization of the political and security situation in the Gulf region. Al-Safran affirmed that the recent improvement in Boursa Kuwait could be reflected in increased liquidity flowing into the real estate sector in the coming period.

Regarding prices, he said the government’s move to release more vacant land and increase real estate supply will contribute to greater market balance and help curb price increases. It is worth highlighting that real estate transactions showed mixed performance during the second week of June, with 134 deals valued at KD 108.7 million, compared to 88 deals valued at KD 124.9 million in the previous week. This reflects a 52.3 percent increase in the number of transactions, while the total value declined by 13 percent. According to the weekly report from the Real Estate Registration and Documentation Departments at the Ministry of Justice, covering the period from June 7 to 11, the market witnessed activity across the private, investment, industrial, coastal strip, and retail real estate sectors

By Marwa Al-Bahrawi Al-Seyassah/Arab Times Staff