Housing Prices Fall 30 – 40% in Kuwait

From today’s Arab Times

Price of residential homes falls as ‘meltdown’ digs in

KUWAIT CITY, March 10, (KUNA): Prices of residential homes in Kuwait have fallen between 30 and 40 percent since February, the Manazel Holding Company chairman said here Tuesday. The drop differs from one area to another, dipping by 60 percent at some areas and 15-20 percent at others, Adnan al-Nesf told Kuwait News Agency (KUNA). The prices have been on the wane since Laws 8 and 9 for 2008 were put in place. Both laws bar companies from selling or buying houses, he said.

The global financial crisis is to blame for the decline in house rates, al-Nesf added. The laws were adopted after the prices had reached record levels, but the situation could have been solved in a way that would not lead to a ban on home activities by mortgage companies, he said. Several rules and controls could be imposed on dealing in homes that directly concern citizens; including allowing landlords to sell their houses only after five years of buying, he suggested.

However, he voiced optimism that the crisis would be resolved soon, especially following a recent court ruling allowing the Kuwait Finance House (KFH) to deal in houses. An improvement in the real estate sector would surely push the economic wheel forward, he argued, pointing out that the property market was waiting for an in-the-offing rescue plan to be put in place soon. Just like other companies, real estate dealers have been negatively affected by the current world financial meltdown, he affirmed. But, he recognized that most property dealers were trying to retrench their expenses, lay off workers or cut workers’ salaries.