Muscat, Property Market Outlook, Winter 2016/17
Muscat’s residential market has been subject to some very challenging economic conditions over the past two and a half years, with average rents since the start of 2014 slipping by almost a fifth on average.
The ongoing economic challenges are of course echoed across OPEC states around the world. While the initial impact of the oil price collapse was perhaps cushioned to an extent by the rise in oil production levels, the government continues to take positive steps to rein in costs amidst the debilitating economic conditions.
The full effect of the government’s current cost containment strategy has impacted overall job creation levels and as outlined above, has translated into an expanding programme of redundancies across of range of sectors. This ultimately has undermined the regular level of requirements for residential property in Muscat.
In the office market, requirements have continued to dwindle, which is posing serious challenges for the office market and also means landlords will have to be even more creative in order to create demand going forward. Good quality management, facilities and bonus perks are likely to become increasingly common as landlords compete for the limited number of mobile occupiers.
Elsewhere in the commercial market, the four and five star hospitality sector is going through a period of rapid expansion in Muscat driven by significant rises in inbound tourism numbers and spending over recent years.