The real estate market in Qatar is not likely to see short term improvements when numerous newly-built buildings sit empty, according to the authority on the nation’s banking regulations.
Qatar Central Bank (QCB) released a report on the nation’s financial stability stating that the real estate sector is lagging due to the currently tremendous supply of housing. Inflation has been stabilized with declining rents, which were the biggest culprit in rising inflation rates recently.
As rents drop it reduces the ability of property development firms to service their debt after taking loans to construct the buildings.
Qataris have an unemployment rate of only 2.3 per cent, while the QCB puts the overall jobless rate in the nation at 0.3 per cent nominally. About 70.8 per cent of nationals are working within the public sector with under five per cent employed within the private sector.
The majority of employed expats are working in private employment, 83 per cent, while less than four per cent are working in the government sector. Professionals make up half of the national workforce with the other fifty per cent working within service industries and in technical positions.
Overall 44 per cent of the Qatar labour force works within the construction industry, with 25 per cent employed within industries.
Opposite of the trend seen in 2008 where prices rose up to 15.2 per cent, Qatar experienced deflation last year. In 2009 the country saw 4.9 per cent deflation as rents fell almost 12 per cent over the course of the year. QCB praised the government’s successful efforts at diversification within the country’s economy.
Success of the economic diversification is best seen by the declining share the oil and gas industry has in Qatar’s GDP, dropping to 45 per cent in 2009. The central bank noted that Qatar is forecasted to experience high economic growth this year, according to “The Economist.” This publication ranks Qatar’s healthy growth potential with India and China.Paul Holdsworth, Staff Writer, Gulf Jobs Market News