New report says Muscat's residential market continues to be oversupplied with apartment blocks
Oman's residential real estate prices continued to decrease during 2018 as demand remained subdued overall, according to consultancy and chartered surveying firm, Cavendish Maxwell.
Its new report indicated that Muscat’s residential market continues to be oversupplied with apartment blocks, despite a gap in the market for high-quality villas and townhouses.
The Oman Market Report for 2018 also said that the country's office sector saw demand for business centres increase in 2018 as a result of firms downsizing and seeking fitted office premises at lower costs.
Demand for Grade A stock is expected to remain stable and developers should benefit from current market conditions and lower costs to build.
Khalil Alzadjali, head of Cavendish Maxwell in Oman, said: “Oman’s real estate market showed slow growth in 2018, but there were improvements in certain areas.
"Real estate transactions increased by 1.2 percent compared to 2017, although sales contracts decreased by a percentage point. Other significant areas of development have been in the tourism and industrial sectors, with new hotel room inventory and industrial estates expected to be added in 2019.”
Looking ahead to 2019, he said Oman continues to offer significant investment opportunities, thanks to its growing non-oil economy, particularly in the tourism and industrial sectors, as well as in integrated tourism complex (ITC) developments.
The report said that despite weaker consumer sentiment and sluggish market conditions, the retail sector witnessed developers adding more space to the existing stock in Oman, particularly in Muscat.
In 2018, several new malls entered the retail market, including Landmark Group’s Oasis Malls in Sohar and Salalah. Al Araimi Boulevard, Mall of Oman and Mall of Muscat will all add more retail space as they near completion.
New regulations and incentives from Oman’s Ministry of Tourism have helped boost Oman’s hospitality sector, the report added.
Cavendish Maxwell also noted that there are currently 72 hotels under construction in Oman, amounting to a total of 6,604 rooms. By the end of 2019, 55 of those developments are expected to be completed, adding 4,763 rooms to the sultanate’s hotel supply.