Posted on April 25, 2015

The 9.5% growth in the population over the last one year in Qatar has contributed to some new demand for residential units in certain locations, a study by a prominent real estate house has found, said Gulf Times.

“One of the major concerns in relation to the country’s inflation rate is the housing market, where rents have gone up due to an under supply of accommodations across for all income groups,” a senior official of DTZ, told a roundtable yesterday.The 230-year-old real estate house, which started its Qatar operations more than a decade ago, has also reported concerns about the construction costs inflation, which according to an independent report it quoted could peak at 18% during the 2022 FIFA World Cup building boom between 2016 and 2019.

Johnny Archer, DTZ associate director (consulting and research), explained it remains to be seen if the quantum of the population leap during the three-year period could be as big as the one Qatar witnessed in the last two years. The country’s population stood at the all-time high of more than 2.34mn at the end of March this year. “The indications are that the population growth would be less than the economic growth rate, which is expected to be around 7%,” the official pointed out.

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DTZ has also reported a slow start to the office-leasing market in the first three months of 2015, with many Qatari institutions cutting down their budget. New requirements for the office accommodation are on hold both at the government level and also in the hydrocarbon sector, it said.The agency has noticed that about 170,000sq m space is leased in Doha’s West Bay area every year since 2009. It has been found that almost 65% of the total leased space in the area has been acquired by either a government institution or by one of the companies working in the hydrocarbon-related industry.

While the number of large-scale acquisitions is likely to fall, chances are that there could be an increase in smaller lettings to the private sector as government spending on infrastructure related projects escalates. The agency has found currently spaces of about of 1.68mn sq m  are available in the West Bay area, which is almost 42% of all supplies in Doha. A further 300,000sq m office space is likely to come in the area and Lusail by the end of this year. The new developments would increase vacancy levels and ease the upward pressure on rents that was witnessed in 2014.