(MENAFN - Arab Times) Real estate sales during December totaled KD 363 million, more than double the amount of the same month of 2011. Similar to November, the large y/y increase was a result of strong sales in all three major real estate segments.
As for the full 2012, total sales reached KD 3.1 billion, up 16% compared to 2011 and indicating a generally healthy year for sales. Residential sector sales totaled KD 204 million in December, rising by a sizable KD 117 million y/y. The jump in sales came from a higher number of transactions, especially for plots of land.
The total number of all residential transactions in December rose by 73% y/y. The 3-month average (October - December) price for residential plots recorded 333 KD/m2, while the comparable price for residential homes recorded 632 KD/m2. These prices are aggregated across different governorates, as well as different specifications, and therefore only serve as a general indicator.
As for the full year, aggregate sales in the sector reached KD 1.7 billion, up 20% y/y, and averaging 657 transactions per month, compared to a 494 average in 2011. These figures indicate a healthy sector, backed by persistent local demand. The investment sector (mainly apartments and buildings intended for rental) saw KD 116 million in sales during December, KD 55 million more than December 2011. The sector saw a strong recovery in Q4 2012, after some slowdown earlier in the year. In terms of pricing, the 3-month average price for apartments was 626 KD/m2 for the October-December period, while whole buildings recorded 1301 KD/m2. As for plots of land allotted to the investment sector, the 3-month price went up to 1139 KD/m2.
Sales in the investment segment totaled KD 1.2 billion in 2012, up 16% y/y. Both healthy demand and on-coming new supply should keep the sector in good shape for the near future. Sales in the commercial sector totaled KD 43 million, down from last month but more than double the monthly average for 2012. About KD 24 million came from the sale of 3 separate commercial buildings in Hawalli governorate, while most other transactions took place in Kuwait City. This sector brought in KD 252 million in sales in 2012, a 2% increase from the previous year. However, the last 2 months of the year witnessed increased interest in the sector. If this trend continues, alongside a more active government real estate fund, we could see a notable pick-up in sales in 2013.
Overall, 2012 saw a more active real estate market compared with recent years. The residential segment continued to lead sales, grabbing 55% of the total, while the investment segment took 37% and generally appeared to be in good shape, posting y/y increases in 8 out of the 12 months. The commercial sector somehow also managed to end the year on a positive note. Overall, we expect the positive trend in sales to continue in 2013, albeit with varying intensity among the three segments. Meanwhile, the Savings and Credit Bank (SCB) approved a little more than KD 22 million in loans, spread out over 394 applications. About a third of those applications were for the construction of new homes. Additionally, the SCB disbursed KD 9.2 million in housing loans.