The Bahrain Economic Development Board said the country's real estate sector grew 4.5 per cent in the first quarter of 2017, adding US$1.7 billion to the country's economy, as recent reforms to bolster investment in property sparked an increase in demand.
"Recent figures demonstrate the resilience of Bahrain's real estate sector and highlight the increasing demand for housing, not only in the kingdom but across the wider region," said Khalid Al Rumaihi, the chief executive of the economic development board.
"Strong growth in this sector has been supported by the implementation of economic and legislative reform and forward-thinking policies such as the public private partnership model by the ministry of housing and the recently issued real estate law."
The Bahrain Economic Board said that real estate transactions in the country were valued at $770 million in the first quarter of 2017, an 8.1 per cent increase in the same period last year. The hotels and restaurants sector grew 12.3 per cent year-on-year.
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Bahrain urged to strengthen fiscal revenue and external finances to defend currency peg
Bahrain's non-oil sector growth rises to 4.4 per cent in the first quarter of 2017
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Demand for residential units in Bahrain is growing at a rate of 5,000 units a year, according to the ministry of housing. Visitors to Bahrain have also been increasing, bolstering demand for tourism and retail facilities. Some 5.6 million tourists visited the country in the first half of the year, a 14 per cent increase from the first half of 2016, according to the Bahrain Tourism and Exhibitions Authority.
More than $11bn of mixed use projects in Bahrain are being marketed at the Cityscape property exhibition in Dubai this week. That includes Bahrain Bay, a 450,000 square metre $2.5bn waterfront district on the outskirts of the business area. Bahrain Marina, another mixed-use development on the Manama coast, is expected to also boost tourism when it is completed by 2021.
"Cityscape Global is an excellent platform for developers to showcase their world-class projects to interested investors and we think Bahrain has great developments to offer and are pleased to be taking part for the third year in a row," said Mr Al Rumaihi.
The GCC nation has also been busy building large scale infrastructure projects valued at $32bn throughout the kingdom and as well as physical projects the country has been undertaking regulations designed to boost growth in the real estate sector.
Bahrain, whose long-term issuer rating was cut by two notches to Ba2 by Moody’s Investors Service in July, has faced financial difficulties in the wake of a slump in oil prices over the past three years. The kingdom, which is not a member of Opec, has turned to external borrowing and is running an austerity campaign to narrow the budget gap.