A new report says Bahrain’s real estate market is benefiting from demographic growth, improved affordability, and supportive government initiatives. The sector, like the country’s economy, remains resilient despite macroeconomic and geopolitical challenges in the region.
The report, which analyses Bahrain’s property market for the fourth quarter of 2024, is prepared by Savills, the global real estate services provider. It sheds light on key trends, challenges, and emerging opportunities in the Kingdom’s real estate landscape.
The introduction of long-term residency options, like the Golden Visa, has been instrumental in boosting investor confidence. This has led to an increase in sales activity, particularly in the residential market, as more expatriates opt to purchase properties rather than rent.
Bahrain’s GDP growth was 2.1 per cent in 2024, largely driven by the non-oil sectors, particularly manufacturing and financial services, which together account for 37 per cent of the country’s GDP. With the focus on economic diversification, plans for new industrial zones and the development of a greenfield airport in the country are set to attract both local and international investment, providing a solid foundation for further economic and market growth.
Hashim Kadhem, Head of Professional Services, Bahrain, Savills Middle East, commented: “The Bahraini property market continues to show growth despite global economic uncertainties.
“With new infrastructure projects and government initiatives in place, Bahrain remains an attractive destination for both investors and residents. The growth in residential, retail, and industrial sectors highlights the Kingdom’s evolving real estate landscape, and we expect this momentum to continue well into 2025.”
Residential sector remains solid
Residential prices have shown steady growth, with high-end apartments seeing a year-on-year price increase of 1.4 per cent, while villa prices have remained stable. This indicates a strengthening of demand for premium properties, as more consumers seek modern developments equipped with high-end amenities.
The increasing popularity of large, well-designed homes has been particularly evident in the rental market, where rental values rose by 23 per cent across the Kingdom in 2024. In particular, the Capital Governorate accounted for 48 per cent of rental transactions.
Locations such as Diyar Al Muharraq, Manama Seafront, and Juffair continue to be popular hotspots for property transactions, maintaining strong performance year on year.
Developers have increasingly launched projects that integrate residential, commercial, retail, and recreational spaces, providing buyers and investors with more comprehensive living environments. The Urban Planning and Development Authority’s decision to expand the residential-use area by 208,000 square metres is a step taken towards addressing the country’s housing demand.
Office and retail sluggish
The commercial office market, however, faced some challenges throughout 2024, with limited demand and relatively flat rental growth. New developments, such as SayaCorp Tower, and the Future Generation Tower, scheduled for completion in 2025, may contribute to further market adjustments.
In the industrial sector, Bahrain’s focus on manufacturing continues to drive demand for warehouse space. Larger warehouse spaces have seen a slight increase in rental rates, with a 2.1 per cent year-on-year growth, while rates for smaller units have remained stable.
The industrial market remains integral to Bahrain’s economic diversification strategy, and further investments in infrastructure are expected to continue supporting demand for industrial space.
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