Bahrain's residential property market remains severely depressed amid continued uncertainty surrounding the political and economic environment.
New homes that are coming into the market are in some cases being sold at a loss, according to a report released yesterday.
"Several middle-income housing projects have been launched in Bahrain in the last three months, and sales have reportedly been brisk to date," according to a first-quarter report by the property consultancy CBRE.
"However, analysis reveals that some of these projects are effectively being sold at a loss, or at best, cost price, in order to stimulate the market and raise the profile of the ongoing master-planned projects of which they are merely a very early phase."
Expatriates are for the most part giving Bahrain's property market a wide berth.
"In the current socio-political climate, sales to expatriates have naturally dwindled to virtually nothing as employment risks and the long-term future of Bahrain remain somewhat uncertain," analysts at CBRE said. "Nevertheless, sales in projects or properties away from the more troubled areas are still taking place albeit at rates and prices well below those of four or five years ago."
Meanwhile, there are varying performances in the retail mall sector in Bahrain. Malls including City Centre and Seef Mall in Manama are enjoying high occupancy levels and strong rents, CBRE said. But others in the capital are not faring so well.
"At the bottom of the performance scale we have Sitra Mall, the performance of which can only be described as 'catastrophic'," analysts at the property consultancy wrote.
"Failure to locate the anchor tenants in locations that have any impact on the rest of the mall, poor access, social unrest in close proximity to the mall and outlets that fail to meet the needs of the mostly low-income villages nearby are all factors in this mall's sad decline," CBRE said.
Still, there are signs that declines in the property sector are slowing, according to the report.
"The major market sectors indicated on the rent-cycle chart are all now in the same quadrant of slowing decline, indicating the perception that Bahrain's real-estate sector is at, or near, the bottom of the market."
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