Bahrain Luxury Residential Real Estate Market Size

Bahrain Luxury Residential Real Estate Market Analysis

The Bahrain Luxury Residential Real Estate Market size in terms of transaction value is expected to grow from USD 279.82 million in 2024 to USD 376.39 million by 2029, at a CAGR of 6.11% during the forecast period (2024-2029).

The market is driven by the demand for luxury residents from the GCC as well as other foreign countries. Furthermore, there is also demand for rental real estate, which is driving the market.

The Kingdom of Bahrain is an archipelago between Saudi Arabia and Qatar. It is made up of the main island of Bahrain and dozens of smaller islands. It has become more popular with foreign retirees and investors because it is safe and quiet, has low living costs, and has a diverse population. Bahrain, for example, allows women to work and drive, which is considered more liberal than neighboring Gulf Cooperation Council countries such as Saudi Arabia and Qatar. While Arabic is the official language, English is widely understood. Despite increasing population growth and an influx of foreign residents, Bahrain's residential market has softened in recent years due to an oversupply of housing.

During January–March 2022, Bahrain's residential capital values remained stable. Across the country, demand for rental properties such as villas and townhouses remained strong in Q1 2022. According to a real estate services provider, capital values in Bahrain's residential real estate segment have remained largely stable every quarter. When compared year on year, the capital value index for apartments and villas in the country has dropped by an average of 1.2% and 2.6%, respectively, according to Savill's Q1 2022 Bahrain Market in Minutes report.

Foreigners in Bahrain are limited to buying in freehold areas, which include Durrat Al Bahrain, Seef, Reef Island, Juffair, Amwaj Islands, Dilmunia Island, Diyar Al Muharraq, and Riffa Views, according to brokers. New construction continues in Bahrain, with approximately 9,000 new units expected by 2026 in Diyar Al Muharraq, a complex of seven artificial islands near Manama, likely further depressing rents. At the moment, average residential prices in Bahrain are roughly half those of comparable properties in Dubai, United Arab Emirates. People from countries in the Gulf Cooperation Council, primarily Bahrain and Saudi Arabia, account for 75–80% of all sales transactions in Bahrain. Several of the remaining buyers are British, Indian, and Pakistani.