Azeem Nawaz
CEO & Founder
Insight Real Estate
Bahrain’s real estate market has been somewhat turbulent over the past couple of years in lieu of the COVID-19 and forthcoming variants. The real estate market was thrown into an unconventional state when the COVID-19 pandemic struck. Between people losing work and being afraid or unable to move, restrictions and lockdowns had a significant impact on the market.
Even as life regains a sense of normalcy, there are several factors that will continue to impact housing prices, rental or buyer behaviour and the real estate market in general.
It wouldn’t be erroneous to say that the implication of the pandemic era has left the real estate market with quite uneven behaviour, particularly in terms of decision-making power, which has dramatically distressed the entire market scenario in terms of closing deals effectively resulting in losing potential clients and/or deals surprisingly. However, this trauma may escalate and lead to a larger crisis in connection with the forthcoming situation of suspected COVID variants floating in the news. Nevertheless, the market may boost if no harm arises during the upcoming months and improvements of the real estate market and tenants’ behaviour could be witnessed.
Having spent a couple of years with restricted market conditions, it has been witnessed that the majority of potential clients/tenants carry the fear of losing jobs/income when searching for properties, which ultimately put them under pressure for the ‘closed contracts’ and strict ‘term and conditions’ and is certainly a huge drawback of losing potential clients based on these uncertainties which is clearly an enormous factor of the current slow market.
Keeping in view that a large number of expatriates are the main clients for the rental market and the majority of them are job holders in private firms – the fear of losing jobs or even reduction of wages is the core factor of uncertainty of the real estate market. Potential clients have been seen negotiating on contractual clauses, especially the diplomatic clause, which has previously not been mentioned in rental or lease agreements but has now become one of the main points where clients/tenants take longer to decide.
All of these factors have led the consumer to become less urgent when it comes to renting and buying residential properties. Looking ahead in residential real estate, I see less a decline in the necessity urgency to lease or buy as more people get outside of their homes and are drawn back to other activities. Top regions may remain very strong and prices should stabilise for the short term as more properties emerge.
Moreover, the real estate market will significantly appreciate despite the crises that have occurred – the market declined dramatically two years back and it will certainly bounce back with its full thrust.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.” (Franklin D. Roosevelt)
This article was published as part of the seventh edition of Property Finder Bahrain’s Trends Report.
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