Residential Real estate market will remain tenant-friendly for a longer duration because real estate recovery will take longer to stabilize owing to fewer transactions, lower sales as well as uncertainty surrounding the coronavirus pandemic, say property analysts.
Due to the ongoing situation surrounding Covid-19 resulting in job losses and salary cuts, co-living is also gaining momentum in the GCC.
Thomas Mathew, assistant vice-president Kamco Invest, rentals have been pushed at least one-step back from their respective pre-Covid-19 stages in the rental cycle due to fall in demand in the wake of job losses and salary cuts due to the pandemic.
“Prior to the impact of Covid-19, rents in the residential segment were recovering in markets where supply additions were minimal and government initiatives for home ownership were being rolled out,” he added.
He said affordability continued to remain a theme, as good quality affordable units continued to witness stabilizing rents. “However, with the onset of Covid-19, and lower visibility for growth in household incomes, we expect affordability to remain the dominant theme in the residential market, and asking rents for new tenancy contracts to trend lower in the near term before bottoming out,” said Mathew.