The Kuwaiti real estate market saw its largest decline in sales in five months in July, according to a report by National Bank of Kuwait (NBK).
Only 415 property transactions were registered at the Ministry of Justice during the month, the news agency KUNA reports.
This represents a 42 percent drop, compared to the previous month, and comes after months of solid sales growth, the report said.
"The dip was driven by an unusually large seasonal effect, with activity falling away as the summer travel season began. The timing of the travel season might have shifted this year, with Kuwaitis holidaying earlier than usual in order to return before Ramadan.
"If so, sales activity should eventually bounce back, once the traditionally slow Ramadan period is over. Sector-wise, the residential and apartment segments were the key drivers of July's decline in sales. Activity in the commercial sector, by contrast, rose and had its best month this year (in sales value, KD19.2m)," the report stated.
According to the report there were 317 residential sales in July compared to 510 in June – a drop of 38 percent. However, this figure represents an increase of three percent year-on-year.
"July's drop was probably linked to the seasonal factors described above, rather than anything more long-lasting. In general, consumer confidence remains solid and lending conditions are more or less unchanged, suggesting little justification for a relapse in home sales. We estimate that land sales accounted for just over 40 percent of all residential transactions in July," the bank said in its report.
Sales in the investment segment fell 53 percent to 93 in July, which was also down four percent on the same month in 2009.
Meanwhile, commercial sales were less affected by the summer season, with five recorded in July, up from two made in June.For all the latest Kuwait news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.