a day ago
Get Ready! Real Estate Demand In Kuwait To Surge With New Visa Rules
KUWAIT CITY, Aug 20: International real estate appraiser Emad Al-Faraj says opening the door to issuing various types of visit visas (family, commercial, and tourist) will stimulate real estate activity and change the structure of demand for real estate in the country. He affirmed that the increasing number of expatriates will boost demand for investment apartments, and if supply does not expand, this will lead to a gradual increase in rents in the future. In an exclusive interview with the daily, Al- Faraj explained that the lack of reliable data and expertise is one of the most significant challenges facing real estate appraisal in the country.
The disparity in real estate appraisal in Kuwait is more acute due to the absence of regulatory bodies that issue mandatory appraisal forms and link the issuance of any report to a traceable accreditation number. This reduces the chances of manipulation or error, enhances investor confidence, and creates transparency in the market. He said, 'Kuwait is witnessing extensive real estate legislative activity. The success of the Real Estate Developer Law depends on the clarity of its executive regulations, the presence of field supervision over construction phases, and the provision of real financial and technical guarantees to developers.'
Al-Faraj emphasized the importance of the Anti-Vacancy Law in preventing land from being left unused and turning into a tool for speculation, while also warning against fraudulent construction practices aimed at avoiding fines. He noted the relative stability of real estate transactions by the end of 2025 and anticipated a balanced and sustainable real estate market in 2026, supported by ongoing legislative reforms, infrastructure development, and the launch of new housing projects.
Al-Faraj initially spoke about the role of the Real Estate Appraisers Association in supporting and promoting real estate valuation in Kuwait, stating, 'Real estate valuation is the compass that guides the decisions of investors, financiers, and legislators. The market value of a property is not merely a number on paper, but a reflection of a precise equation that factors in location, usage, technical condition, supply and demand, economic conditions, and the legislation impacting the market. Given the pivotal role real estate plays in the national economy, accurate and transparent valuation has become a strategic necessity to protect capital, stimulate investment, and ensure sustainable growth.' Below are details of the interview with International Real Estate Appraiser Emad Al-Faraj:
Question: What explains the disparity in real estate valuations in Kuwait?
Answer: Although valuation discrepancies are not unique to Kuwait, the issue is more pronounced here due to the absence of a standardized, mandatory framework to unify practices in the sector. In more advanced real estate markets, regulatory authorities issue mandatory valuation models and link every appraisal report to a traceable certification number. This significantly reduces the chances of manipulation or error. Implementing a similar system in Kuwait would enhance investor confidence, bring greater transparency to the market, and ensure that any differences in valuation are justified and supported by clear, consistent data.
Real estate valuation in Kuwait has evolved beyond being a purely technical matter, as it is now a strategic tool that directly affects economic stability. The transition from scattered individual practices to a unified and transparent system requires true collaboration between legislators, appraisers, and investors. This is precisely where the Kuwait Real Estate Appraisers Association plays a vital role. Since its establishment, the association has been laying the foundation for a new generation of qualified appraisers capable of reading the market accurately and delivering fair valuations that protect all stakeholders.
Q: What is the impact of the expansion in the issuance of visit visas on the real estate market? Do you expect rents to rise in the future?
A: The decision to open visit visas for business, tourism, and family purposes will stimulate commercial, economic, and tourism-related real estate activity. This marks a shift in the demand structure of the property market. As the number of expatriates grows, so will the demand for investment apartments, particularly in areas like Salmiya, Hawally, Farwaniya, and Khaitan that have developed infrastructure and services. If this demand is not matched by a corresponding increase in apartment supply, we are likely to see gradual rent increases in the coming years.
Q: Kuwait is witnessing an unprecedented real estate legislative boom. What do you think will be the impact of this on the real estate market?
A: Kuwait has indeed entered a significant phase of legislative reform in the real estate sector. This can be described as a restructuring of the legal foundation of the market. One example is the Real Estate Developer Law, which was introduced to deal with long-standing issues such as project delays and poor construction quality, problems that left many citizens vulnerable in the past. This law is designed to protect all parties involved, expedite development processes, and encourage more investment into the sector. However, the success of this law hinges on the clarity of its executive regulations, consistent on-site oversight during construction phases, and the availability of real financial and technical guarantees from developers.
Q: What about the Vacant Land Monopoly Law?
A: This law is a vital step toward preventing land from being frozen and used merely as a speculative tool, rather than serving its intended purpose for development. However, attempts to circumvent the law through unplanned or superficial construction to avoid fines undermine its effectiveness. This highlights the need for comprehensive oversight and strict enforcement of penalties, which the relevant authorities are currently working on.
Q: What is your reading of real estate transactions in 2025 and your expectations for 2026?
A: While real estate transactions in 2025 appear relatively stable on the surface, a closer look reveals that investment and commercial properties are benefiting from residential and commercial activity, while residential properties remain relatively stagnant due to rising prices and land scarcity. If legislative reforms continue, along with infrastructure improvements and the rollout of new housing projects, 2026 may mark the beginning of a more balanced and sustainable real estate market.
Q: What role has the Kuwaiti Real Estate Appraisers Association played since its establishment?
A: The establishment of the Kuwaiti Real Estate Appraisers Association in 2023 came at a crucial time, as the market was in urgent need of regulating the profession and raising its standards. Previously, valuation practices relied heavily on individual discretion, with no unified framework to ensure consistency and reliability across reports. The association aims to promote the adoption of International Valuation Standards (IVS) locally, qualify and train national professionals in the latest analytical methods and models, and embed integrity and transparency as fundamental principles in the valuation profession.
Q: Is the association working with any regulatory or legislative bodies?
A: Yes, there is active coordination with legislative and regulatory bodies to develop legal frameworks that govern valuation practices.
Q: What impact have these efforts had on the real estate sector?
A: These initiatives have helped build a more disciplined professional environment, which has been reflected in the improved quality of valuation outputs and greater market confidence in those valuations.
Q: What are the challenges facing real estate valuation in Kuwait?
A: Several challenges continue to hinder the accuracy and reliability of real estate valuation in Kuwait. They include:
Lack of a reliable central database, as without access to up-to-date and accurate data on transaction prices and market activity, valuations are often based on personal judgment. This opens the door to significant discrepancies in property values between appraisers.
Variations in experience and methodology, as some appraisers use modern methods such as advanced comparative analysis or discounted cash flow models, while others still rely on basic estimates or inaccurate comparisons, resulting in inconsistent outcomes.
Influence of personal interests, as in some cases, appraisers may face pressure to raise or lower property values to serve specific agendas.
This undermines the credibility of the profession and can lead to inaccurate valuations, flawed financing decisions, price inflation, and substantial investment losses. For these reasons, accurate and transparent valuation has become a strategic necessity, not only to protect capital, but also to stimulate investment and support sustainable economic growth.
Meanwhile, real estate trading liquidity rose by 54 percent (KD 76 million) in the second week of August, with 130 transactions valued at KD 139.8 million, compared to 133 transactions worth KD 63.8 million in the first week of the same month. The weekly statistical report issued by the Real Estate Registration and Documentation Departments for the period from August 1 to 14 recorded a total of 263 transactions for private, investment, commercial, and coastal properties, with a combined value of KD 203.6 million.
Private real estate topped the list in terms of transaction volume over the two-week period, accounting for 70.7 percent of the total, with 186 transactions valued at KD 66 million, representing 25 percent of the total value. Investment real estate ranked second, making up 47.5 percent of the total with 66 transactions valued at KD 65 million, representing 24.7 percent of the overall market value.
While commercial real estate recorded no transactions in the first week of August, it saw a significant surge during the second week, specifically from August 10 to 14, with 12 transactions totaling KD 70.4 million. This accounted for 27 percent of total real estate liquidity during the two-week period. Coastal real estate recorded a single transaction in the second week, valued at KD 1.4 million. In addition, there were no transactions involving craft properties, banks, warehouses, showrooms, or shops over the past two weeks.
