The coronavirus pandemic caused great uncertainty worldwide, and the housing and property industry was severely impacted. However, many countries are now seeing economic booms and are bouncing back from the impacts of the pandemic, with property and rental prices increasing. The Middle East is an area of the world where the housing market has seen exponential growth following the pandemic.
In this article, we take a look at three localised housing markets: Dubai in the UAE, Riyadh in Saudi Arabia, and Doha in Qatar. All three locations have experienced massive growth regarding their property industry and expat housing markets, with different contributing factors. Read on to see how the Middle East housing market is changing.
Housing in Dubai
The housing market in Dubai and the rest of the UAE, as was the case across many Middle East housing markets, suffered through the beginning of the pandemic. But now, the property market is rebounding and seeing exponential growth. Government initiatives such as residency permits for retirees and remote workers has aided the growth in the property market, as well as the economic boost from the Expo 2020 Dubai and the expansion of the 10-year golden visa initiative.
The UAE has also seen a widespread coronavirus vaccination programme, which has benefitted the property market by keeping coronavirus cases relatively low by comparison to other countries. This has made moving to Dubai and finding housing in Dubai a much more attractive venture.
Meanwhile, demand for extra space and additional amenities amid spells of working from home during the past 12 months have also boosted activity within the real estate sector.
The value of property deals in Dubai has more than doubled over the last year, breaking a 12-year record for value of sales. In 2021, the emirate of Dubai registered over 60,000 property sales, worth a value of over 151 billion AED (Arab Emirati Dirham), or approximately £32.5 billion. You can read our guide on the Dubai exchange rate and other Middle Eastern currency exchanges to find out more.
According to local listings information portal Property Finder, 2021 was the best year for total housing transactions in Dubai since 2013 and was also the best in terms of deal value since 2009. The sale of luxury home sales hit their highest rate since 2015, showing how well the housing market has rebounded from the impact of a global pandemic.
Housing in Riyadh
Like Dubai and the UAE, Saudi Arabia’s real estate and property market also experienced exponential growth in 2021. With the economy bouncing back from the pandemic, the kingdom reported that it has seen residential mortgages increase tenfold in 2021 compared to rates in 2016.
The increased interest in housing in Riyadh and Saudi Arabia marks a huge amount of progress within Saudi Arabia’s Vision 2030 program, which celebrates its fifth anniversary this year. The program is formed around three core pillars or aims: to make Saudi Arabia a vibrant society, a thriving economy, and an ambitious nation.
The Kingdom is certainly delivering on those goals so far; Saudi Arabia’s GDP was estimated to have grown by 2.9% in 2021, and is forecast to grow again by a further 6.2% in 2022. Average rental prices across Riyadh’s Grade A segment increased by 8.6%, with Grade B rental prices increasing by 6%, in Q2 of 2022 alone.
The boom in the property market is testament to the high standard of living in Saudi Arabia. The financial and employment prospects are yet another attractive feature of life in Saudi Arabia – read our guide on moving to Saudi Arabia, or our article on reasons to move to Saudi Arabia to find out more.
Housing in Qatar
Qatar is also experiencing the post-pandemic property boom, but in a slightly different way to the likes of Dubai, the wider UAE and Saudi Arabia. The housing market in Qatar has an incredibly positive outlook at the moment, which is largely down to the FIFA 2022 World Cup, which will be taking place in Qatar over the winter months.
The World Cup is expected to draw hundreds of thousands of spectators from all across the globe to the capital city of Doha, and has been at the core of Qatar’s economic plans for some time. The World Cup remained a source of hope for economic decision-makers in the country throughout the uncertainty of the pandemic, as the hospitality and tourism sectors are set to experience exponential growth around the event.
The residential real estate market is also set for incredible growth, currently predicted to register a CAGR (compound annual growth rate) of over 11.5% over the next few years. Though many residential projects were cancelled or postponed as a result of the coronavirus pandemic, the increased demand coming from a global event like the FIFA World Cup has allowed the rental market to stabilise, and subsequently grow.
Read our guide to find out more about moving to Qatar.