(MENAFN - Kuwait News Agency (KUNA)) Real estate data for March show sales totaling KD 351 million, up 20 percent y/y, closing the 1st quarter with sales totaling KD 923 million, an economic report showed here on Monday.
Sales were up across all sectors with an exceptional performance by the commercial sector. The residential and investment sectors remained solid, and the real estate sector is expected to have another strong year, it said.
Sales in the residential sector reached KD 177 million in March, a 1 percent y/y increase. Although there was a 10 percent y/y decline in the number of transactions to 439, this was more than offset by a rise in the average transaction value. The latter increased 32 percent y/y to KD 403,000, showed the report, released by the National Bank of Kuwait (NBK).
It is worth noting that despite strong year-on-year increases in sales, the number of transactions has been dropping (year-on-year) in past months - a possible reflection of the short supply of residential properties available on the market.
In terms of location, 34 percent of transactions were in Al-Ahmadi governorate, followed by Mubarak Al-Kabeer with 25 percent of transactions. Sales of land plots - as opposed to finished buildings - accounted for 57 percent of all residential transactions in March. Quarterly, Al-Ahmadi also led the governorates with 33 percent of all transactions in the first quarter followed by Mubarak Al-Kabeer, which has been seeing increased activity in the Abu Fateera and Funaitees areas.
Sales in the investment sector stood at KD 132 million in March, up 9 percent y/y. The sector also saw a 53 percent y/y increase in the number of transactions, recording 195 transactions by the end of March. The increases reflected on the average size of transaction which dropped 29 percent y/y, to KD 680,000. In quarter analysis, the investment sector sales grew 35 percent compared to Q1 of 2013, it said.
Individual apartments made up more than half of all transactions in the investment sector - the majority in Mahbola. Whole buildings came in second, accounting for 32 percent of transactions, followed by plots with an 11 percent share, it added.
Sales in the commercial sector soared 9 percent to KD 42 million in March, from KD 22 million a year earlier. The sector recorded 12 transactions, with one plot in Jahra selling for KD 11 million. Sales in this sector are often uneven month-to-month. While the sector's performance in the first two months of 2014 seemed to be cooling, March sales confirmed a strong bounce back.
March also witnessed two significant transactions classified by the Ministry of Justice as "coastal line" properties. The first is a 4,000 m2 residential plot in Messila sold for KD 9 million, while the second was a 3,700m2 commercial 'shops' transaction in Mahbola, for KD 7 million. Kuwait Credit Bank approved KD 29 million in loans in March, down 16 percent from a year ago. The past year has nevertheless been a very active year for the bank. The slowdown in the past couple of months may be linked to a slowdown in the distribution of plots, the NBK report concluded.