Bit: Real Estate Market Continues Recovery, 1 Billion Dinars in Transactions in Q3

A report by Kuwait Finance House revealed that the local real estate market during the third quarter of 2026 saw the value of real estate transactions rise to approximately KD 1 billion, an increase of 12.4% compared to the second quarter of the same year. The number of transactions reached 1,502, a slight decrease of 0.5% over the same period. Private residential property remained the most active sector in terms of both value and number of transactions. Meanwhile, improved trading in investment, commercial, and artisanal real estate contributed to supporting the total transaction value, which continued to be bolstered by the stability of the local economic environment, the strength of the banking sector, and sustained demand across various real estate categories in one of the most prominent non-oil sectors of the Kuwaiti economy.

The report noted that the growth in capital expenditure and government projects under the development plan and Kuwait Vision 2035, alongside strong banking liquidity and the growth of real estate credit, contributed to the improvement and rise in transaction values during the third quarter, despite external factors such as geopolitical tensions, unprecedented fluctuations in oil prices, and anticipation of global monetary policy trends. The real estate sector demonstrated clear resilience thanks to local demand and improved investor confidence. Positive future outlooks were further reinforced by recent legislative reforms, including the Real Estate Financing Law, whose executive regulations are awaited, along with other laws such as the Sukuk Law, which support the economy and help sustain real estate activity in the coming period on a more balanced trajectory.

The future outlook remains linked to the pace of implementing government projects and residential cities, developments in real estate financing, liquidity and credit levels, as well as the impact of oil prices, geopolitical conditions, and the path of global monetary policy.

The report stated that on an annual basis, the value of real estate transactions in the third quarter of 2026 declined by 20.0% compared to the third quarter of 2025, while the number of transactions fell by 4.0%. Performance varied across sectors: the value of private residential transactions rose by 15.0% and artisanal transactions by 120.6%, while investment real estate transactions declined by 11.7%, commercial by 58.5%, coastal by 26.2%, and warehouses by 90.5%. In terms of the number of transactions, private residential transactions increased by 6.9%, while investment real estate transactions fell by 17.7%, commercial by 57.9%, coastal by 33.3%, artisanal by 66.7%, and warehouses by 87.5%.

The report indicated that the value of private residential transactions rose to KD 455.3 million in the third quarter of 2026, an increase of 6.7% on a quarterly basis, with the number of transactions stabilizing at 1,106. Investment real estate transactions also increased to KD 359.1 million, up by 25.1%, with the number of transactions rising to 359, an increase of 9.5%. Commercial real estate recorded transactions valued at KD 183.1 million, a 62.2% increase from the previous quarter, despite a decline in the number of transactions to 32, down by 28.9%.

Conversely, trading in the coastal strip declined to 2.3 million dinars through two transactions, and warehouse trading fell to 1.8 million dinars through a single transaction, while commercial real estate trading rose to 18.2 million dinars through two transactions. The agricultural nurts category recorded no trading activity during the quarter. The average total value of real estate transactions reached approximately 679,000 dinars in the third quarter of 2026, up by 11.8% from the second quarter of 2026, but remained roughly 15.4% lower than its level in the third quarter of 2025.

Market Trends

The report reviewed market trends, noting that private residential prices fell by 0.5% at the end of the third quarter of 2026 compared to the previous quarter, recording an annual decline of 4.8%. Meanwhile, investment property price levels rose by 1.3% on a quarterly basis, registering an annual increase of 6.1%. Commercial property prices remained stable with no significant change on a quarterly basis, while increasing by 1.8% on an annual basis.

At the end of the third quarter of 2026, prices in most residential areas declined slightly on a quarterly basis. This included several areas in the Capital Governorate, which saw a limited decline from the previous quarter, thereby reducing the average price in the Capital Governorate by 0.4% and in the Hawalli Governorate by 0.3% on a quarterly basis. Prices remained stable in some areas within these two governorates, while other areas experienced slight changes in price levels.

Prices in some private residential areas of the Farwaniya Governorate declined, with the average price in the governorate falling by 1.7% compared to the second quarter of 2026, amid limited price declines in some of its areas. Price levels in the Mubarak Al-Kabeer Governorate also declined slightly by 0.2% on a quarterly basis, driven by a slight decrease in some areas and stability in others. In the Ahmadi Governorate, price levels fell by 0.2% on a quarterly basis, reflecting a slight and limited decline in the average price in most areas of the governorate. Additionally, the average price in the Jahra Governorate dropped by 1.4% compared to the second quarter, accompanied by a slight quarterly decline in most areas of the governorate.

The average price per square meter for investment property continued its upward trend, reaching 1.896 dinars at the end of the third quarter of 2026, recording a quarterly growth of 1.3% and an annual increase of 6.1% compared to the third quarter of 2025. This quarterly increase covered all governorates, with prices rising by 1.0% in the Capital, 1.2% in Hawalli, 1.5% in both Farwaniya and Mubarak Al-Kabeer, and 1.6% in Ahmadi. Jahra recorded the highest quarterly growth among governorates at 1.9%. On an annual basis, prices rose by 4.8% in the Capital Governorate and by approximately 5.1% in Hawalli, while average prices in the remaining governorates increased by notable margins.

The average commercial price per square meter across governorates remained stable at the end of the third quarter, showing no significant change from the previous quarter. The average price remained stable in most governorates, with a slight increase in others. Meanwhile, the annual growth rate at the governorate level slowed, recording 1.8% in the third quarter, compared to an increase of 4.1% in the second quarter on an annual basis.

The quarterly decline rate in the average price of industrial property eased by the end of the third quarter of 2026, recording a 2.7% drop compared to a 4.1% quarterly decline in the second quarter of 2026, while the average price in craft properties remained unchanged on a quarterly basis for the second consecutive quarter.

The average price per square meter, calculated based on residential areas across the State of Kuwait, fell to KD 958 for private residential property, a 0.5% decrease from the second quarter of 2026. Meanwhile, the average price per square meter for investment land rose to KD 1,896, representing a quarterly increase of 1.3%. The average price for commercial property in commercial areas reached KD 4,988 per square meter, with a slight quarterly decline of approximately 0.02%. The average price for industrial land stood at KD 774, and the average for craft property reached KD 2,865 by the end of the third quarter of 2026.

Ownership Apartment Prices and Rental Values

A report by Bit Financing stated that the average price per square meter for ownership apartments in investment properties with areas of 95 and 70 square meters rose by 1.9% on an annual basis, reaching KD 917 across the governorates. The average price per square meter in the Capital Governorate was the highest in the country, recording KD 1,154, followed by the average price in the Al-Mubarakiya Governorate at KD 1,091, and then the Hawalli Governorate at KD 1,052. In Farwaniya, the average price was KD 796, while in Ahmadi, it reached KD 762 by the end of the third quarter of 2026.

The average rental value for private housing reached KD 679 nationwide, a 4.9% annual decline. The average in the Capital Governorate was KD 845, while in Hawalli it was KD 747. In Farwaniya, the average was KD 537, and in Ahmadi, it was KD 505. In Al-Mubarakiya, the average was KD 637, representing a 2.6% annual decline. Meanwhile, the average rental value in the Jahra Governorate saw a higher decline, recording KD 450 by the end of the third quarter of 2026.

The average rental value for apartments in investment properties reached KD 351 across the governorates by the end of the third quarter of 2026, a slight increase of 0.4% on a quarterly basis and 0.9% on an annual basis. The average rental value in the Capital was KD 377, up 0.7% annually. In Hawalli, the average reached KD 372, up 0.5% annually, while in Farwaniya it was KD 344, up 0.2% annually. In Al-Mubarakiya, it was KD 363, up 0.7% for the same period. In Ahmadi, the average was KD 313, up 2.0%, and in Jahra, it was KD 350, up 2.2% compared to the third quarter of 2025.