Average residential rents in Doha up 16pc year-on-year

Wednesday, 23 October 2013 Doha: A lack of supply in the residential market due to increasing expatriate inflow has led to an average annual rental increase of 16 percent, says the latest Asteco Qatar Q3 2013 report. On average two-bedroom units in The Pearl Qatar development have increased by 9 percent compared with Q2 2013 and 16 percent year-on-year. A two-bedroom apartment now costs on average of upwards of QR14,000 per month, closely followed by similar sized apartments in West Bay, which now command rents of up to QR12,000 per month — an average increase of 6 percent which has been consistent over the past year. “Leasing rates have most notably increased in The Pearl Qatar, where availability will continue to be scarce until the completion of a number of new towers currently under construction,” said Jed Wolfe, Managing Director, Asteco Qatar. Availability of good quality villas is also limited, with rental increases apparent in most locations across Doha. On average West Bay Lagoon is now the most expensive area to lease a four-bedroom villa at QR27,000 per month, up 16 percent year-on-year, while Ain Khalid and Al Waab saw annual increases of 18 percent and 15 percent, respectively. “The expatriate influx has also driven further demand for serviced apartments, where occupancy levels have increased from long-stay guests,” added Wolfe. Increasing rents in the freehold zones have led to an increase in expatriate tenants looking to purchase and a resurgence in investor appetite. Direct and resale prices in the Porto Arabia-Pearl increased 7 percent and 9 percent respectively, while direct and resale values for properties in Viva-Bahriya-Pearl were up 6 percent and 3 percent. “According to figures from the Ministry of Justice, the number of sales transactions fell from Q3 2012, however, the overall value of transactions increased, indicating an increase in average property values,” said Wolfe. In the commercial sector, a significant number of property deals have been agreed for office buildings in West Bay, which will lead to a decrease in availability of prime office space in the area, potentially driving rents upwards for the remaining space available. “The average price per square metre per annum in West Bay is QR185, which is still 5 percent lower than Q3 2012, but significantly it is 9 percent higher than Q2 2013,” said Wolfe. Although evidence should suggest that most of the demand for office space is for smaller sized office suites in West Bay, in light of increasing occupancy levels, many landlords are reluctant to enter into negotiations with potential tenants unless they consider taking up an entire or at least half a building. Most of the remaining available office building space is either to shell and core standard, awaiting government interest, or below the standards required by most tenants, especially offices in secondary locations. The Peninsula