This may not be the best of times for the Real estate sector in Oman, in the Asian continent, as real estate prices may have already begun to fall in this quarter following a new visa rules, which restrict expatriates in Oman.
This is even as developers and agents prepare for slow businesses.
Oman, which became an independent state in 1741, after gaining its sovereignty from Portugal has a population of 3,090,150 (2012), and covers 309,500 square kilometers of land, making it the 71st largest nation in terms of land area.
Oman shares land borders with 3 countries: Saudi Arabia, Yemen, United Arab Emirates.
Leasing companies and property owners in Muscat the Oman capital are lowering prices as a response to the visa ban, according to property managers interviewed by the Times of Oman.
A manager at Hilal Properties said: “Most expats cannot come to Oman for work because of the ban, so their numbers are down. Some expats are even returning to their countries, which is why a lot of properties are now on the market.” She added: “For that reason, most owners are also reducing rents. This trend is apparent across Muscat.”
A representative from Taif Properties said: “The real estate market relies on new arrivals, and across the board there has been a ban on professions. So yes, it has had a drastic effect on real estate prices.”
“We’ve even seen it in popular neighbourhoods such as Madinat Qaboos and The Wave. It is affecting all the places. Madinat Al Ilam, a villa that was rented for OMR1,500 in November, was rented for OMR900 this February,” the representative stated.
They added: “Traditionally, summer months are always the busiest for us because that’s the big changeover. That is when the school year ends, so everybody who is leaving leaves during that time and new people arrive. July and August are very busy. So, I imagine it should pick up anyway because of how the traditional market is. I am sure if they lift the visa ban, it will greatly help.”
Others, however, felt the slowdown follows the downturn in oil prices, which has coincided with a decrease in the number of white-collar expats and growing Omanisation in certain sectors.
Sudhakar Reddy, General Manager of Al Habib, told the Times of Oman: “Of course, fewer expats will come in after the visa ban. But one has to bear in mind that the number of white-collar expats has been decreasing constantly over the years anyway.”
“Since 2015, Al Habib’s apartment rents have been lowered significantly in areas in Amerat and Mabella. Also, rents dropped marginally in high demand areas such as Khuwair, Ghubra, Adhaiba, Ruwi, and the Central Banking District (CBD),” he said.
Reddy said that despite there being fewer expats, realtors could still keep doing good business because more Omanis were likely to rent.
“Many Omanis getting jobs for the first time tend to move out of their parents’ houses and rent a house. Many times, they do it to be closer to their place of work,” he added.
The prices of villas have gone down as well. “Rents of old villas have been going down since 2015. But, the rents of new villas have held up. Villas may cost you anywhere between OMR600 and OMR4,000 monthly,” Reddy said.
“The visa ban has certainly had an effect. One thing is that more expats will not be coming to Oman, which is a bad sign for rental markets. The market has already fallen in the previous years due to the downturn. We need to do something to revive this market. With more jobs being created in Muscat, there may be a positive effect with Omanis from other regions coming to rent homes here. So, we will have to see how it works,” Ammar Al Safar, rental in-charge at Al Qandeel Real Estate, said.