Real estate sector challenges probed

A NEW study has been launched to find ways to reinvigorate the real estate sector in Bahrain.

It will also seek to identify problems faced by developers and investors, and further push for more concessions from the government.

The study was launched by the Bahrain Property Development Association (BaPDA) after it signed a memorandum of understanding with the Bahrain Chamber of Commerce and Industry (BCCI) to review the challenges facing the sector due to the pandemic.

“We launched this study to assess the challenges in the real estate sector and will review evidence and best practice to ensure decision-makers have a detailed picture,” BaPDA chairman Aref Hijris told the GDN yesterday.

“There are 27 big developers who are part of our association, who will add value to this survey.”

He said like other sectors even the real estate business took a hit due to Covid-19, but added that compared with other neighbouring countries, Bahrain market was still stable.

“Bahrain continues to be the favourite market for citizens and GCC investors because it’s not centred around unreal demands of speculations.

“The government has a proper roadmap for this sector because of which there is no oversupply, but we have a calculated approach that has helped us so far.”

Mr Hijris said real estate-friendly laws and supervisory authorities such as the Real Estate Regulatory Authority (RERA) have helped maintain stability and confidence.

“I think the coronavirus chapter is slowly closing now as we see Dubai opening up next month and Saudi Arabia starting internal tourism operations.

“There are a lot of opportunities in the markets now as Bahrain offers the best properties at reasonable rates rather than inflated prices, or extravagant public relations or marketing strategies.”

He added that there would also be a renewed push to get the infrastructure tax either revised or waived to help developers.

“We request the authorities to revise or stop the infrastructure tax and this will be a big incentive for the developers, who need this support during this time,” said Mr Hijris.

Under the 2015 Infrastructure Cost and Development Law, a levy of BD12 per square metre is charged on all developments in a bid to fund infrastructure projects such as roads network, sewerage systems, electricity and water schemes in undeveloped areas.

Mr Hijris said despite the pandemic, the real estate sector in Bahrain is expected to be stable.

“There was a market slowdown before Covid-19 which has further slowed the process.

“But I remain optimistic about growth in the sector because housing is essential, like food, and couples getting married will always need a house to raise a family.”

Meanwhile, the BCCI conducted a survey covering different sectors to assess the damage caused by Covid-19.

The findings of the study, that covered 1,180 business owners, revealed that 27 per cent of the respondents stated they expected closure and bankruptcy in the real estate and construction sector. A total of 72pc of businessmen expected a significant decrease in their revenues and 55pc expected to cease operations within six months.

 

Source: http://www.gdnonline.com/Details/826079/Real-estate-sector-challenges-probed

 

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