It was in 2008 that Euromoney magazine released a report under the title: “Qatar: a burgeoning real estate sector”. “The boom in Qatar real estate market that has been an inevitable by-product of the spectacular growth of the economy in recent years and the surge in demand for residential as well as commercial property that has emerged as a result,” read the subhead for the report, which attributed the “boom” to several success factors; in June 2004, Qatar was among the first to overturn 1963’s Law number 5 – which prohibited non-Qataris from owning land – and allow non-Qataris to own property in Pearl Island, West Bay Lagoon, and Al Khor resort.
In 2006, the Qatari government extended that list from three to eighteen areas. In March 2005, a memorandum by Global Investment House’s GCC Real Estate Fund stated that the Qatari market was underserved by the real estate sector.
In 2006 and 2007, a slew of market instabilities followed, driven by the shortage in supply, the rising costs of construction, and resulting inflation. However, at the time, agencies like Moody’s expected inflation to “decline over the medium term as newly constructed housing gradually becomes available and the investment boom moderates.”
And so it did, as the market self-regulated in a relatively short period of time, setting the scene for the Qatar real estate market’s exponential growth that was to follow. Indeed, in 2012, the realty market in Qatar real estate recorded an unprecedented – and yet to match – growth rate of 72 percent. In August 2012, Qatar Real Estate Registration Department (RERD) reported that property transactions registered under it amounted to $ 440 million within a span of two weeks – between June 24 and July 5 – “indicating strong activity across the board through the sales of open plots of land, villas, houses, residential buildings and complexes,” stated a report by Oxford Business Group. The report also added that Q1 of 2012 recorded sales of $ 3.5 billion, overshadowing 2011’s transactions, which, in total, had amounted to $ 7.2 billion.
In January 2013, QCB released a qatar real estate index, using the fiscal year 2009/2010 as the base. By end of 2012, the index showed, real estate prices were up by 5.8 % from 2011 – although the index average for that same year was 22% lower than the peak it had witnessed in 2008. Moreover, according to Business Monitor International, in the first half of 2012, rent prices skyrocketed due to overwhelming market demand, with industrial rents, retail rents, and office rents jumping by 78.2%, 39.9%, and 10 %, respectively.
Although hindered by a surge in property prices and decreasing demand, Qatar’s property market maintained a growth trajectory in 2013, albeit slowing down to a 10.5%, according to Qatar National Bank’s recently released “Qatar Economic Insight Report”. However, QNB’s report asserted that such figures were still reflective of a healthy economy and demand for real estate services by a growing population of expatriates and workers – while the overall non-hydrocarbon sector’s growth was bolstered by the construction sector, which itself grew by 13 % year-on-year. In fact, figures released by the Ministry of Development Planning and Statistics stated that Qatar’s economic growth accelerated at a remarkable rate of 6.2 % percent year-on-year in the third quarter of 2013.
The QNB report also predicted real GDP growth to accelerate to 6.8 percent in 2014; indeed, Qatar’s continuous commitment to its National Vision 2030, bid win over the hosting rights for the World Cup 2022, and announcements of a slew of major infrastructure projects – which include the Doha Metro, the New Hamad International Airport, and the new Doha port –are only poised to propel the Qatar real estate sector, population, trade activity, and economy forward.