Oman: Residential tenants looking to move to better accommodation at a cheaper rate are advised to do so now, owing to reduced rents because of a surplus of homes and a decrease in the number of expatriates, who would normally occupy such properties.
The 2020 Oman Property Report, which is published by real estate management firm Savills, notes that lower oil prices and the impacts of the COVID-19 pandemic are likely to continue to challenge Oman economy and the real estate sector.
“Current evidence suggests that a net exodus of highly qualified expatriates started in 2016 due to economic conditions and increasing restrictions on expatriate employment,” said Savills. “The number of highly qualified expatriates dropped by 17.6 % between 2016 and the first quarter of 2020, while the total number of expatriate employees dropped by 6.8 % during the same period. Savills expects that the reduction in the expatriate population will be accelerated by recent events.
“While better quality residential units are likely to show a more stable performance, the expected drop in the number of expatriates in Muscat over the coming months will place the residential market under increased downward pressure in terms of both reduced demand and achievable rental values. Savills does, however, foresee potential interest from existing tenants to look to upgrade from their existing rental property at more affordable values.”
According to data published by Savills, the residential rental market in Muscat has also seen a notable increase in supply over recent years.