Residential property transactions have kept Qatar’s real estate sector busy and buoyant in 2023, with a significant part of the year’s trading volume driven by demand for homes.
Our latest publication, Qatar’s Property Report Q4 2023, revealed that the country’s residential real estate sector has proven to be resilient amid speculations of a slowdown a year after the FIFA World Cup Qatar 2022.
In 2023, transaction volume in real estate reached QAR 16.7 billion, down from QAR 21.2 billion. Meanwhile, mortgage volume decreased by 31% in 2023 to QAR 45.6 billion, according to the Ministry of Justice.
Despite this, investing in apartments remained popular. The Ministry of Justice reported QAR 2.75 billion worth of residential units sold, 82% higher than QAR 1.51 billion in 2022. The average deal size per residential unit transaction rose by 26% from QAR 2.1 million in 2022 to QAR 2.64 million in 2023.
Our analysis revealed that approximately 56% of trading volume was done for the intention of villas and houses (for instance, buying land to build a villa), while 18% for residential units.
Yields
Overall, we found that gross rental yield across Doha’s prime apartment market (West Bay, Lusail, and The Pearl) stood at 6.6% in Q4, a healthy sign for the real estate sector. This still makes Qatar an attractive investment destination within the Gulf region.
Apartment rental
The Pearl was the most sought-after location for apartment seekers, followed by West Bay, and Fereej Bin Mahmoud. Fox Hills in Lusail saw downward pressure on average apartment rents in Q4. For apartment tenants, this means greater leverage to seek bargains in Lusail.
Villa rental
Al Waab, Al Gharrafa, and Al Markhiya were the most popular locations for villa rental searches on hapondo in Q4. Al Thumama, Al Waab, Al Gharrafa, and Ain Khaled saw lower median rents in Q4, while median rents in Al Mamoura, Al Hilal, and Old Airport have become more expensive.
Apartment sale
In terms of apartments for sale, median prices across Doha’s prime market remained stable for the one-bedroom category. There were more affordable options listed in the market for studio apartments in The Pearl and Lusail.
Hotels vs apartments
Hotels continued to reach out for more long-stay guests through better rates in the 1BR category. Our analysis shows an already narrow difference between the median rent of 1BR apartments and hotels in areas such as Al Sadd (13.3%) and Al Mansoura (7.1%). In several districts, hotel apartments were more affordable than regular apartments.
Commercial real estate rents
Tenants who were looking for an office in Q4 would have still seen a wide basket of options, from unfitted spaces to business centers.
The difference between a fully fitted office and unfitted space in West Bay (346%) almost equaled that of Al Sadd (343%), revealing the high premium to pay for a plug-and-play office.
The performance of retail in Lusail has been much more promising, where Fox Hills saw a 4.2% increase in average lease rates outside malls.
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