RIYADH: Bahrain’s real estate sector remained steady in the first quarter of this year, with 6,124 sales transactions, representing a marginal 3 percent year-on-year decline, an analysis showed. According to a report released by real estate services firm Savills, the value of transactions in the property market also witnessed a slight drop of 1.2 percent in 2023 to $2.92 billion compared to the previous year. However, the volume of real estate transactions in the country grew by 24.1 percent in 2023 compared to 2022. “Despite challenges, the real estate sector continues to grow, driven by government support, rising investor confidence, and an increasing demand for real estate in the region,” said Hashim Kadhem, head of professional services, residential sales and rental market at Savills. According to the report, home buyers in Bahrain are becoming more strategic in the market, primarily focusing on mid-range properties. Moreover, more affordable housing options with improved amenities have shifted the market dynamics in favor of tenants. Kadhem added: “Bahrain’s coastal location and flourishing high-end tourism industry continued to drive demand for luxury waterfront properties, which appeal to buyers seeking exclusivity and comfort.” The report revealed that a stream of projects is expected to be handed over this year, which could further widen the gap between demand and supply and potentially affect capital values in the short term. According to the study, capital values of apartments grew slightly by 0.3 percent in the first quarter of this year compared to the previous three months. On the other hand, high-end villas witnessed a 4.5 percent dip in capital value in the first quarter compared to the same period of the previous year. Office sales and rental market The report revealed that Bahrain’s office sector real estate market experienced a quiet period in the first quarter of this year, with businesses renewing leases in high-quality Grade A properties. According to Savills, capital values for these remained stable in the first quarter, driven by an increase in supply. Grade A office spaces enjoy a premium over the average rent prevailing in the area due to their location, infrastructure, and young age. The report also suggested that co-working spaces also witnessed high demand in the first quarter, mainly from startup companies and businesses looking to downsize.