Strong and positive momentum is expected to continue in the Sultanate of Oman's real estate sector thanks to the shifting trends suggesting that the property market is once again on the investor radar.
After softening demand due to the pandemic, the real estate market has seen an upswing since the third quarter of the previous year, backed by a solid structural foundation and gain in demand. Along with a slew of decisions and measures, the Omani government's new ownership scheme that allows foreigners to own properties outside integrated tourism complexes (ITC) is expected to attract capital investments in the property market.
Dr Khalid bin Saeed al Ameri, Chairman of the Board of Directors of the Omani Economic Association, in a dialogue session last week, invited proposals from the real estate experts to come up with visions that can contribute to increasing the sector's attractiveness to investors. "The flexibility of laws, legislation, and regulatory and incentive measures taken in the real estate sector has a direct role in stabilizing real estate markets and maintaining investor confidence", he said.
The meeting reviewed purchasing power, such as the impact of value-added tax on residential sales, the availability of financing and interest rates, and availability and clarity of data, such as daily trading, clarity of investment directions, and future plans in the real estate sector. The session also touched on technology in the real estate sector, applications, and crowdfunding.
The total traded value of real estate activity exceeded RO 1.3 bn at the end of last July, and the total traded value of the property rose during last July only to 213.1 mn Omani riyals, an increase of 27.4 percent compared to June 2022.
Dr Khalid indicated that the fees collected for all Legal transactions amounted to RO 35 million, a decrease of 37.8 percent compared to the end of July of last year, while the traded value of sales contracts increased by 0.1 percent compared to the end of July 2021, to reach RO688 mn. The number of sales contracts reached RO 40.110 mn contracts, down by 18.9 percent.
The Oman government's focus is more on making housing affordable and available for everyone. The push for 'Housing for All Citizens' fuelled the demand for affordable housing and, in turn, generated much-needed liquidity in the sector.
Oman's Ministry of Housing and Urban Planning has presented plans for five new constructions totalling 4,800 housing units, catering to an estimated 24,000 people, following the success of its first Integrated Housing Development Project in Barka based on the Public-Private Partnership (PPP) model.
The ministry has unveiled new opportunities for real estate companies and institutions specializing in real estate development (both domestic and international) who have experience, competence, financial and administrative capability in real estate development and who wish to compete, file an "Expression of Interest" to develop.
Last week, the ministry announced five more new sites for real estate developers in the governorates of Musandam, Dhofar, South Al Sharqiyah, North Al Sharqiyah, North Al Batinah, and South Al Batinah. According to market intelligence and advisory firm Mordor Intelligence, the residential real estate market in Oman is expected to register a compound annual growth rate (CAGR) greater than 13 percent during the period from 2022 to 2027.
This forecast for Oman's property market comes amid a report published by Next Move Strategy Consulting that the global real estate market generated $ 9.52 bn in 2021 and is estimated to reach $ 14.55 billion by 2030, witnessing a CAGR of 4.8 percent from 2022 to 2030.
