Qatar’s housing market improving

With the recent introduction of more liberal foreign property ownership rules, the end of the economic and political blockade against Qatar, as well as improving economic conditions, it is not surprising that Qatar’s housing market is now showing signs of improvement.

The real estate price index rose by 2.82% during the year to Q3 2021, in sharp contrast to a y-o-y fall of 5.67% in Q3 2020, according to the Qatar Central Bank (QCB) - the country’s  best showing since Q2 2016. However in real terms, real estate prices were up by a minuscule 0.11%.

Source: Qatar Central Bank

Quarter-on-quarter, prices increased 2.06% in Q3 2021 (0.82% inflation-adjusted).

Transaction volumes in the country rose strongly by 36% to QAR 31 billion (US$8.5 billion) during 2020, from QAR22.8 billion (US$6.3 billion) in 2019 despite the pandemic, according to the Ministry of Justice. In Q3 2021, transaction volumes for houses in Qatar fell by 25% from a year earlier but increased by 60% from two years ago, according to ValuStrat’s Q3 2021 report.

Muaither, Al Wakrah and Al Khor had the highest volume of transactions for residential houses in Q3 2021.

The improved real estate market performance “is evidence of improved buyer confidence stemming from several factors: increasing competitiveness of properties, the introduction of policies facilitating foreign investment, normalisation of relations with GCC countries, and positive reinforcements from holding of World Cup in 2022,” according to Pawel Banach, ValuStrat’s General Manager. 

In preparation for the 2022 FIFA World Cup, Qatari real estate boomed for three glorious years 2012-15, fuelled by rapid population growth and a construction boom:

  • In 2013, the real estate price index surged 20.74% (16.45% inflation-adjusted).
  • In 2014, the real estate price index soared by 34.67% (31.81% inflation-adjusted).
  • In 2015, real estate prices rose by 14.39% (10.75% inflation-adjusted).

However in 2016, the value of real estate transactions plunged by about 50%, and prices fell by 4% (-5.15% inflation-adjusted). Real estate prices fell a further 9.9% (-10.4% inflation-adjusted) in 2017, by 2.6% (-2.4% inflation-adjusted) in 2018 and by another 8.1% (0.6% inflation-adjusted) in 2019, as Saudi Arabia’s hostility adversely affected Qatar’s economy. In 2020, the housing market continued to struggle, with prices falling further by 8% (-4.8% inflation-adjusted), amidst the Covid-19 pandemic.

In October 2020, the Qatari government responded by loosening its foreign property ownership rules, in an effort to attract more expatriates, foreign buyers, as well as real estate funds.

Qatar estate price index

Then in January 2021, the Saudis agreed to end their sweeping economic and political blockade against Qatar, begun four years ago. Qatar´s politics are more liberal, which irritates the Saudis. In addition Qatar, like Turkey, maintains support for the pan-Islamist Muslim Brotherhood, abhorred by the UAE and the Saudis, and maintains links to Iran, with which it shares a major oil field. The new deal, which may reflect Saudi attempts to conciliate Biden after its previous love-fest with Trump, restores the air, land and sea links to the emirate that were severed in June 2017. 

The Qatari economy is projected to grow by 1.9% this year, following a contraction of 3.6% in 2020, according to the International Monetary Fund (IMF).

Foreign property ownership eased further

The new law introduced in October 2020 includes two important changes:

  • It increases the number of locations where non-Qataris can purchase real estate outright
  • It introduces a two-tiered residency program that rewards large investors with government-provided services


Earlier, the Qatari government approved Law No. 16 of 2018, which increased the number of freehold zones in Qatar from 3 to 10 effective last March 2019. Aside from The Pearl, West Bay Lagoon, and Al Khor, foreigners are now allowed to obtain freehold ownership in Rawdat Al Jahaniyah, Al Qassar (Area #60), Al Dafna (Area #61), Onaiza (Area #63), Al Wasail (Area #69), Al Khraij (Area #69), and Jabal Theyleeb (Area #69).

Foreigners who buy in designated freehold zones are automatically granted permanent residency, which extends to the owner’s family, for the whole duration of the ownership. Those qualified include:

  • children of Qatari mothers who are married to foreigners;
  • people with special talents "needed by the state";

And other individuals who extended notable services to the country.

Foreign investors who buy a property valued above US$ 1 million will be eligible for permanent residency, which comes with government benefits such as education and health care (previously limited to Qatari citizens and long-time permanent residents). With the new law, semi-permanent residency status is now open to buyers of property worth US$200,000, who can obtain renewable residency permits for themselves and their families without the need to be sponsored by an employer.

Permanent residents of Qatar will be treated like Qatari nationals and enjoy benefits such as access to healthcare and education systems, priority (after locals) for military and civilian public jobs, and will have permission to operate commercial activities without a local partner, and permission to own a property.

Three-fourths of Qatar’s population are foreigners, according to the Qatar Statistics Authority (QSA). About 82% of the population lives in Doha and Al Rayyan.In addition, the Ministry of Justice has recently launched a special section on its website for non-Qatari real estate ownership. The page lists the areas in which non-Qataris may own and benefit from real estate, the procedures, terms and conditions for real estate ownership and use. The page also answers the most common questions about real estate ownership in the country.                                             

Qatar average freehold sale prices

Qatar’s Ministry of Justice has also established an Office for Non-Qatari Real Estate Ownership, according to Cabinet Resolution No. 28 of 2020, which is mandated to provide foreign nationals who want to reside or invest in Qatar with all the necessary requirements for the purchase and sale of real estate, including residential units and office.

However, citizenship will still be off-limits to foreigners.      

Qatar National Bank (QNB), the country’s leading financial institution, offers home and land financing at rates as low as 3.5%. The maximum loan offered to expatriates is QAR3 million (US$824,000) with a term of not more than 15 years. One can borrow up to 70% of the value of the property.

Supply continues to rise

In recent years, Qatar has been grappling with excess supply following the construction boom tied to the 2022 soccer World Cup. The country has currently an estimated excess supply of more than 80,000 units.

Qatar residential supply

In the third quarter of 2021, about 700 units were added to the market, bringing the total stock to 307,215 units, according to ValuStrat’s Qatar Real Estate Market Q3 2021 report.

  • About 600 apartments were completed in Q3 2021 in Abraj Bay Tower 2 in The Pearl and in the three residential towers in Lusail, specifically in the Entertainment district, Al Kharaej, and Erkyah.
  • Major projects launched during 9th Edition of Cityscape Qatar included Crystal Residence, consisting of 15 mixed-use buildings in Gewan Island (The Pearl), apartment and mixed-use buildings in Qetaifan North, 1,700 villas in Furjan Wadi Lusail, Al Yussum townhouses 2 in Yasmeen City Lusail and apartment complex Milos in Legtaifiya.

Rents stabilize; moderate to good rental yields

Residential rents are now stabilizing. In Q3 2021, the residential median asking rent in Qatar were unchanged from the previous quarter, but down by 3.7% from a year earlier, according to ValuStrat.

In Q3 2021:

  • For apartments, the median monthly asking rent stood at QAR 6,200 (US$1,703) per month in Q3 2021, a marginal fall from the previous quarter.
  • For villas, the median monthly asking rent was QAR 10,400 (US$2,856) per month in Q3 2021, a slight increase from the previous quarter.
  • The Pearl, Al Sadd and Lusail saw modest rent increases during the latest quarter

Qatar prime apartments rents

About 59% of all occupied housing units in Qatar are rented, according to QSA. The average expat household in Qatar spends more than a third of its annual income on rent, according to Colliers International.

Gross rental yields for residential properties in Qatar averaged 5.5% in Q3 2021, with 7.1% for apartments and 4.7% for villas, according to ValuStrat.

Mortgage market recovering, amidst falling interest rates

Qatar Central Bank has recently kept its overnight lending rate at 2.5%, following a 100 basis points rate cut in March 2020 in a bid to spur economic activity amidst the coronavirus crisis. During the same period the overnight deposit rate was kept unchanged at 1%, while the repo rate remained at 1%.

As a result, the amount of real estate loans outstanding, which include land purchases, property developments, and residential and commercial buildings, rose by 5% to about QAR 161.48 billion (US$44.35 billion) in September 2021 from a year earlier.

The size of Qatar’s mortgage market was equivalent to about 28.7% of GDP in 2020, sharply up from 23.1% of GDP in 2019 and from less than 8% of GDP a decade ago.

Qatar real estate private sector

Expats can borrow up to QAR3 million (US$824,000) with maximum tenure of 15 years. The loan-to-value (LTV) ratio is typically 70%.

Foreigners can buy in massive freehold areas:

The Pearl-Qatar

The Pearl is a QAR36.4 billion (US$10 billion) Riviera-style development, on a vast man-made island off the coast of Doha, the capital city. It provides over 40 kilometres of new coastline, linked to the mainland by a 4-lane, palm-tree lined highway. Doha’s international airport is only 20 km away. It was here that Qatar offered its first freehold properties.

Developed by the United Development Company, The Pearl-Qatar has 16,000 villas and 25,000 apartments.

West Bay Lagoon

West Bay Lagoon is a 2 million sq. m. private beachfront compound, centered on the Zigzag Towers. At the northern tip of Doha’s West Bay district, it is surrounded by artificial lagoons.

Barwa - Al Khor City

The Barwa - Al Khor project is a complete city, including seafront chalets, villas and elite apartments, covering 5.5 million sq. m. in Al Khor, 57 km north of Doha. The QAR30 billion (US$8.24 billion) Barwa Real Estate development will house 63,000 residents in 24,114 elite residential units. It also has hotels and sports facilities.

In March 2019, Law No. 16 of 2018 was passed, which effectively increases the number of freehold residential zones from 3 to 10.

The additional freehold areas include:

  • Rawdat Al Jahaniyah
  • Al Qassar (Area #60)
  • Al Dafna (Area #61)
  • Onaiza (Area #63)
  • Al Wasail (Area #69)
  • Al Khraij (Area #69)
  • Jabal Theyleeb (Area #69)

“The recent reform to change freehold ownership law will contribute to a positive transformation of the real estate sector which will now embrace its cultural diversity through new initiatives designed to encourage investments and positively change business perspectives to ultimately result in overall economic growth,” said Pawel Banach of ValuStrat.

There are also 16 leasehold areas for foreigners

Foreigners can alternatively buy leasehold property for 99 years, renewable, in 16 designated areas, including the multi-billion dollar Lusail project, under Cabinet Decision No. 6 of February 2006. Foreigners can use the properties commercially or residentially, transfer the lease to another party, and sublet or rent.

Lusail City is an QAR164 billion (US$45 billion) waterfront community on the northern coast of Umm Salal, 15 km north of Doha. It is expected to house over 200,000 residents in 10 hotels, 3,000 villas, 12,000 apartments and retail areas.

Developed by Qatari Diar, Lusail will cover an area of around 21 million sq. m. This mega project, in 16 zones, will contain an Energy City costing QAR9.5 billion (US$2.6 billion), and an Entertainment City, costing QAR5.5 billion (US$1.5 billion). The Lusail Iconic Stadium is also expected to be built in the city. The massive development is planned to be completed this year.

Qatar population

Another mixed use development project is Al Waab City, owned by Nasser Bin Khaled Group, which covers about 1.2 million sq. m. Incorporating “green strategies” and sustainable design principles, it is estimated to cost QAR13 billion (US$3.6 billion). The development includes 2,411 residential units, 232,715 sq. m. of commercial space, and a 425 room hotel complex.

Other leasehold property developments in Qatar:

  • Musheireb (Area #13)
  • Frij Abdul Aziz (Area #14)
  • Doha Al Jadeed (Area #15)
  • Ghanem Al Qadeem (Area #16)
  • Al Rifa Al Hitmi (Area #17)
  • Al Salata (Area #18)
  • Fereej Bin Mahmoud (Area #22)
  • Fereej Bin Mahmoud (Area #23)
  • Rawdat Al Khail (Area #24)
  • Al Mansoura & Fereej Bin Dirham (Area #25)
  • Najma (Area #26)
  • Umm Ghuwailina (Area #27)
  • Al Khulaifat (Area #28)
  • Al Sadd (Area #38)
  • New Mirqab Al Jadeed & Fereej Al Nasr (Area #39)
  • Doha International airport (Area #48)

Qatari economy improving gradually

Before the pandemic, Qatar’s economy had been growing by an annual average of 16.5% in 2004-11 and by 3.8% in 2012-16.

The economic blockade severely hit Qatar’s economy. The participating Gulf-based Arab nations cited Qatar’s support for Islamist groups, violating a 2014 agreement with the members of the Gulf Cooperation Council (GCC), as one of the main reasons for the blockade. Qatar was also criticized by its neighbours for its amicable relations with Iran.

The four Arab nations issued a list of 13 demands on June 22, 2017, which included curbing diplomatic ties with Iran and shutting down Al-Jazeera. Qatar refused to comply, stating that it would not agree to measures that threaten its sovereignty. In a surprise move in December 2018, Qatar ended its nearly 60-year membership of the Organisation of the Petroleum Exporting Countries (OPEC) – the oil cartel dominated by Saudi Arabia.

In January 2021, the Saudis agreed to end their sweeping economic and political blockade against Qatar. The new deal restores the air, land and sea links to the emirate. 

Qatar gdp inflation

Despite the blockade from 2017 to 2019, Qatar had one of the highest current account balances in the region ranging from 3.8% to 8.7%. But due to the pandemic, in 2020 Qatar had a current account deficit, equivalent to 2.5% of GDP. Then the situation changed again, and Qatar’s foreign merchandise trade balance recorded a surplus of QAR 57.8 billion (US$ 15.9 billion) in Q3 2021 -  almost three times as much as the QAR 19.6 billion (US$ 5.4 billion) surplus in Q3 2020, according to Planning and Statistics Authority (PSA).

As a percent of GDP, Qatar’s government gross debt increased sharply to 71.8% in 2020, from 62.3% in 2019 and 52.2% in 2018, according to figures from the IMF. But debt is expected to fall again to about 60% of GDP in 2021.

In November 2021, inflation increased to 6.09%, sharply up from the previous month’s 4.2% and the highest level since December 2008, mainly driven by a surge in transport costs.