Kuwait Finance House: KD 907 million in Q2 real estate transactions

11.4% decline on a quarterly basis... and the sector continues to show momentum

The value of real estate transactions fell by 21.5% year-on-year in the second quarter, recording KD 607,000.

Private residential transactions totaled KD 426.6 million, an increase of 8.2%, while "commercial" transactions recorded KD 112.9 million.

Kuwait Finance House confirmed that the Kuwaiti real estate sector maintained its position as one of the most prominent non-oil sectors during the second quarter of 2026, supported by the stability of the local economic environment, the strength of the banking sector, and continued demand for various property types.

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Data for the second quarter of 2026 showed continued momentum, with the number of traded real estate transactions reaching 1,494 deals in the second quarter, with a total value of KD 907.5 million. This represented an 11.4% decline from the first quarter of 2026, although the number of transactions rose by 12.8% compared to the same period last year. The residential sector remained the most active in terms of both value and number of transactions. Meanwhile, properties along the coastal strip and warehouse categories contributed to enhancing the total transaction value, driven by higher transaction values recorded in these segments.

The report stated that this performance was supported by the growth of non-oil activity, continued capital expenditure, and government projects within the development plan and Kuwait Vision 2035, alongside strong banking liquidity and growth in real estate credit. Although the market was affected by external factors such as geopolitical tensions, unprecedented fluctuations in oil prices, and anticipation of global monetary policy trajectories, the real estate sector demonstrated clear resilience thanks to local demand and improved investor confidence. Furthermore, positive future outlooks were bolstered by potential legislative reforms, particularly the development of real estate financing and discussions regarding a mortgage law, which support continued real estate activity in the coming period on a more balanced path.

The report considered that transaction values remained at an average level, with a 14.3% decline in value in the second quarter of 2026 compared to the high levels witnessed in the same period last year. Coastal strip properties and warehouse categories continued to show notable activity, while private residential transaction values saw limited growth. There was also a slight increase in demand for various properties, reflected in a 2.1% year-on-year rise in the number of traded transactions, driven by limited growth in demand for private residential properties. Meanwhile, demand for commercial properties and warehouses doubled, whereas demand for investment properties and other real estate sectors declined on a year-on-year basis.

Kuwait Finance House’s report clarified that the value of transactions aggregated on a monthly basis rose during the second quarter of 2026 compared to the previous quarter, driven by an increase in private residential transaction values to approximately KD 426.6 million in the second quarter, an 8.2% increase on a quarterly basis, with demand rising to 1,106 transactions, a 23.3% increase for the same period. Meanwhile, investment property transactions fell to KD 287.1 million in the second quarter, a 1.6% decline, with a quarterly drop in demand recording 328 transactions, a 1.8% decrease.

Trading volume in commercial real estate also declined, recording KD 112.9 million, a 47.4% drop on a quarterly basis, despite an increase in demand for this property category to 45 transactions, up 7.1%. Trading value in coastal strip properties rose to approximately KD 23.5 million through four transactions in the second quarter of 2026, more than doubling the value recorded in the first quarter of 2026. Meanwhile, trading value in artisanal real estate fell to KD 700,000, while warehouse properties reached an exceptional level of KD 27.5 million through eight transactions in the second quarter. For the second consecutive quarter, the agricultural nurseries segment witnessed notable trading activity in Q2 2026, valued at KD 29.2 million through just two transactions.

The report noted that the average transaction value index declined to KD 607,000 in the second quarter, down 16.1% year-on-year and by a significant 21.5% on a quarterly basis.

Al-Husseini: 47% of real estate activity attributed to the private sector

Confirmed its leadership of the local market in the second quarter

Hamad Al-Husseini, Executive Director of Real Estate Valuation at Kuwait Finance House, confirmed that real estate sector transactions during the second quarter of this year highlighted the importance of the private residential sector in driving overall market activity and its prominent standing among traders and in total trading volumes. This sector accounted for nearly half of the total trading volume, valued at KD 907.5 million in Q2 2026.

In a media statement, Al-Husseini explained that private residential transactions represented 47% of total real estate trading, a notable increase from the 38.5% share recorded in the previous quarter, securing the top position in Q2 2026. Investment real estate remained in second place among real estate sectors, capturing a 31.6% share of transactions in Q2 2026, up from 28.5% in Q1 2026. Commercial real estate followed in third place, with its share declining to 12.4% in Q2 2026 compared to 21.0% in Q1 2026. Transactions in other real estate categories accounted for 8.9% of total trading, driven by activity in agricultural nurseries, which alone represented 3.2% of total transactions. Warehouse real estate transactions accounted for 3.0% of real estate trading, while coastal strip properties represented approximately 2.6%. Artisanal real estate transactions accounted for just 0.1% of total real estate trading value in Q2 2026.

He added that total real estate trading value reached KD 907.5 million in Q2 2026, according to data and indicators from the Registration and Documentation Department, compiled monthly by the Kuwait Ministry of Justice. This represents an 11.4% decrease from the high level recorded in Q1 2026, yet remains significantly higher by 15% on a year-on-year basis.

For his part, Al-Husawi emphasized that property valuation constitutes a crucial aspect of real estate activity, encompassing multiple levels and contributing to the smooth flow of financing operations and the organization of market transactions on the basis of transparency, professional considerations, and fair valuation that takes into account ground realities and developments. He underscored the distinctive human capabilities and professionalism of the valuation experts at Kuwait Finance House (KFH), which consistently reinforce the high level of trust that clients of all kinds place in the property valuation services it delivers. This is further bolstered by the robust regulatory framework that yields top-tier performance in the market, making KFH the preferred entity for property valuation across all sectors. Backed by a long-standing expertise in the real estate sector, as well as reliability, neutrality, and transparency, KFH operates as an accredited valuation body, supported by a comprehensive database and a multidisciplinary technical team comprising engineers, legal experts, and accountants. This team conducts real estate studies and prepares reports, while continuously monitoring the market and its developments.