Real estate sector shifting towards expats

Improvement tied to political stability

The real estate sector is expected to continue showing a contraction in sales activity, but prices will remain stable, according to a recent report published by Bank Audi.

Ziad Maalouf, CEO of Capstone Investment Group, said: “It’s hard to say for how long the sales will contract but they have recently reached a stable level which could hold for quite some time until a breakthrough occurs on the political level.”

According to the report, the market is set to extend its wait and see attitude, namely at the level of external demand that usually accounts for 30 to 40 percent of total demand. Maalouf said that demand by foreigners had started to diminish since 2008, “but this demand has shifted towards expatriates who tend to understand local risk better than foreigners.” Another reason for the demand shift is that expats are purchasing residential units for end use and not as an investment.

The trend of Syrian nationals renting readily available apartments will persist for a while, the report said. Maalouf said: “We have not noted demand for our projects that are still under construction but we have detected purchasing activity for delivered units.”

The stagnation of prices since 2011 should incite buyers to push forward with their delayed purchases, given that no drop is expected soon, according to the Audi report. The global price increase versus the local market’s realty stability should encourage external demand for real estate.