Real estate prices in Kuwait still high, but could drop this year

Real estate prices in Kuwait still high, but could drop this year

By Nawara Fattahova

KUWAIT: The price of real estate in residential areas in Kuwait is still high and even increased compared to last year, despite the pandemic that negatively affected the economy. But economist Hajaj Bukhadour expects property prices in residential areas will drop this year.

According to him, there are various factors affecting the real estate prices. “The price of real estate in Kuwait is not regulated by the rules of the market. Besides supply and demand, there are other reasons for real estate performance, including monopoly of land and real estate by businessmen, population growth and others,” Bukhadour told Kuwait Times.

Kuwait’s economy is based on two activities – real estate and stocks. “Since 2008 (the global financial crisis), local banks do not accept guarantees of stocks for loans, which was common before 2008, as stocks were considered as assets. Banks now only accept real estate as guarantees for loans. But real estate is mostly mortgaged and there is no supply, which affected prices and led to a hike,” he explained.

“Although there is a recession and a housing crisis, some areas are controlled by brokers and a number of businessmen. This phenomenon should be eliminated after the issuance of the new