About 14 percent of the flats in investment residential buildings are empty, as per a recent study conducted by Kuwait Real Estate Association. In other words, about 52,000 flats out of a total 371,000 flats in 13,353 residential buildings are empty.
Real estate experts expect this phenomenon to increase in the coming summer season particularly by the end of June 2018 when the school year will come to an end.
They indicated that a number of expatriates are planning to leave Kuwait, and some of them have already informed the owners of their buildings about their intention to leave.
The experts explained that a huge number of expatriates, due to the increase in medical fees, electricity charges as well as prices of different commodities and services, are planning to send their families home in order to limit the expenses.
The recent increase in the prices is not accompanied with increase in salaries which has increased the financial burden for expatriates.
The coming summer season will witness increase in the number of vacant flats and decrease in demand, indicating that the building owners will sooner or later be obligated to reduce the rents in order to avoid mass losses.
In addition, real estate experts have disclosed that the rents have reduced by 20-25 percent especially for the recently constructed flats that have several major shortcomings such as small spaces and lack of services such as car parks and maintenance. 60 percent of the recently constructed flats are very bad such that some of them are referred to as “like flats”, which will be difficult to rent out in the coming period.
Source Credit: Arab times