MUSCAT, Aug 8 – On the back of a weaker demand, landlords in Muscat are luring potential tenants with innovative approaches and flexible rent offers. Free Wi-Fi, reduced period for contracts and advance payments, cut in maintenance fee, services like security and delivery of gas cylinders at the doorstep are some of the facilities being offered by desperate building owners. “Landlords are more proactive to conditions prevailing in the real estate sector. With the supply surpassing demand, innovative strategies are required to survive in a struggling market,” said Mubarak al Wahaibi, a partner of a contracting company. New buildings are aplenty in almost all areas of the city.
It is a common sight to see ‘for rent’ boards in apartments and villas.
“A few years ago, landlords were in the drivers’ seat. Now, it is the tenants who are calling the shots,” said Abdul Ammon, an Egyptian national, who lives in Ruwi.
The general consensus around the capital today is that more landlords are offering tenants flexible rates and other facilities.
“We now have enough options to choose from unlike what was before 2014. The rent is also low along with many other facilities,” said Chetan Arora, a businessman who has been in Oman for the last 40 years.
There was a time when landlords enjoyed a good deal of power and could dictate terms to tenants.
“Times have changed. We, the tenants, have an upper hand as we have a number of options,” said Abdul Azis, an Indian expatriate.
Real estate companies are also hit badly as their staff have to put in more effort to get tenants for the vacant properties. “There is an across-the-board fall in rents caused by the availability of a large number of new buildings and a fall in the number of expatriates in the country,” said Nasser al Farsi, a real estate broker.
Meanwhile, reports indicate that real estate market in the Sultanate continues to recover, with sales showing a robust growth in the first quarter of 2018, compared with the same period of last year.
According to National Centre for Statistics and Information (NCSI), the
total value of property transactions in the Sultanate during January-March of 2018 increased by 6.8 per cent to RO 776.3 million, from RO 726.8 million in the same period of last year.
Cluttons’ Muscat Spring 2018 Property Market Outlook report indicated the government’s strong push to boost overall economic growth has resulted in a number of encouraging developments for the property market such as the much-anticipated decision to allow creation of a real estate investment fund (REIF).
“This will pave the way for investments in large-scale real estate projects at significantly lower price points and with far greater liquidity, in comparison to the traditional real estate investment,” points out the report.
Faisal Durrani, head of research at Cluttons, said: “The increased ability of institutions and individuals to invest in income-generating real estate assets has the potential to provide a significant boost to the real estate sector in Oman, particularly since the regulations require that at least 75 per cent of REIF’s assets to be invested in Oman.”
According to the report, rental rates in Muscat appear to have stabilised, with a marginal 1.1 per cent decline in average rates in the first three months of this year.
The largest drop in rental values during the first quarter was seen in Athaiba, North Ghubra, Muscat Hills and Madinat al Sultan Qaboos, while Bausher, Shatti al Qurum and Qurum registered a rise.