Real Estate Market in Bahrain – Rental Vs. Sales Analysis Report Market in Bahrain

Aug 14, 2019
Real Estate Market in Bahrain –  Rental Vs. Sales Analysis Report Market in Bahrain
Real Estate Market in Bahrain – Rental Vs. Sales Analysis Report Market in Bahrain
Aug 14, 2019

The Kingdom of Bahrain continues to be a sought-after location for organisations looking to establish a base within the GCC. The real estate sector in the Kingdom has been a strong contributor to its economic growth solidifying its strength across the GCC as it offers promising opportunities for international investors for real estate properties which are either bought for the purpose of own consumption or for the purpose of investment.

The Kingdom of Bahrain offers attractive opportunities in conducting business and thanks to its central location in the Middle East and direct connection to the region’s largest economy - Kingdom of Saudi Arabia. These two key factors help The Kingdom of Bahrain solidify its strong position as a hub location for businesses. Bahrain is often an option for GCC nationals and expatriates to buy second homes, vacation homes or to just diversify their investment portfolio.

Since the most important factor for choosing Bahrain as an investment destination is the rental yield, the demand for investment in properties is derived from the demand for rental properties i.e the availability of tenants and their preferences. The GCC nationals also buy properties as vacation homes or for self-consumption. In such instances, their preference is similar of Other Arabs buying for consumption. The total rental market is BD 443 million per annum with expatriates accounting for more than 70% of the rental market in terms of value (80% in numbers). Out of the total Bahraini population, only 27% rent while others live in self-owned or family owned houses.

Thanks to the ease with which business can be conducted in the Kingdom of Bahrain, the real estate market will continue to present opportunities for investors across the globe as the Kingdom’s government offered 100% foreign ownership to investors and expatriates in the Kingdom. And since there is an increase in population due to foreigners looking for better jobs in the Kingdom, the demand for rental residential properties will also increase.

What Do Residents in Bahrain Demand?

Such is Bahrain’s diverse population; it is important to understand the cultural preference of residents in Bahrain. 

For example, our studies with Falak Consultancy and Cluttons showed the renter profile of Pakistani and Indian Residents earning between BD1,000 and BD3,000 per month in Bahrain are attracted by convenience.   

81% seeking close proximity to the workplace; 78% seek close proximity to schools but only 57% seek proximity to retail areas.

When compared against the renter profile of UK and Other Nationals, the results showed that whilst a similar percentage (82%) seeks close proximity to schools, 77% prefer closer proximity to retail outlets but 63% prefer close proximity the workplace.

Other factors considered important includes facilities for adults and children, security, parking and furnishings.  

Understanding this data is critical to real estate developers being able to fulfil the demands of a diverse population for both renters and investors. 

What Are the Key Residential Locations in Bahrain?

According to Falak studies, the most attractive key residential location in the Kingdom due to location, luxury and affordability are Reef Island, Amwaj, Bahrain Bay, Riffa, Saar, Hamala, Juffair, Adliya, Mahooz and Hoora.  These are the areas where most of the expatriates reside for rental purpose.

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