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Al-Mazaya Holdings report says the
contribution of different economic sectors to
GDP varies according to their proportional
weight; with the same applying to their
negative impacts on the overall economic
activities. This eventually adds to the
challenges hindering realistic economic
accomplishments and disperses the results
sought from financial, economic mid-to-long
term plans. The real-estate sector is leading
the market and investments are enjoying
major indicators of success, regardless of
the prevailing circumstances. The real-estate
sector is also regarded positively when long
lasting development objectives are sought
from the current development plans within the
region. Al-Mazaya report adds that applying
supply and demand concepts to the real-
estatemarket in a realistic and comprehensive
manner can't accurately be foreseen and
involves uncontrollable risks that can't be
managed in timely basis. Land – being the
base for investment and planning processes
is owned, invested in by the Estate through
real-estate development companies and
allocated to the citizens in accordance with
well drafted decisions and plans. Therefore,
supply and demand mechanisms are
incomplete under such perspectives. That is,
supply forces require demand and vice versa.
When demand increases, prices go up and
the market requires additional spaces to meet
the demand. The unjustified hike on prices
then arises and the market loses its balance.
The main activities and indicators
currently reflected in the Qatari real-
estate sector are elaborated in the Al-
Mazaya report in terms of the hiking
price of land and real-estate - a leading
event amongst the daily developments
taking place however, the assessment
mechanisms and solutions proposed to
overcome such a challenge are varied.
The Qatari real-estate market follows
free market mechanisms and therefore
demand/supply forces are determining the
lease rates and land price in light of the
lack of upper limits on annual increases
on residential lease rates. Lease rates
are being mutually agreed upon between
the lessor and the leaseholder, while
commercial real-estate rates are limited to
10% annual increases aiming to prevent
huge hikes in the price of commodities
and services, or heading towards limitless
inflation rates and uncontrollable negative
impacts. These procedures are taken
at the times when real-estate figures
are striving to assign price rates for
land and real-estate attributed to a legal
basis – yet aiming to manage real-estate
and land prices while avoiding negative
impacts affecting investors, landlords or
on-going economic development plans.
Mazaya Monthly Real Estate Report -
Week 3 - APRIL 2015
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