A new legislation in Kuwait, which allows women to avail housing loans, has resulted in a sharp surge in demand for condominium apartments.
According to a new real estate report by Coldwell Banker Kuwait, developers in Kuwait have started purchasing tracts of land in order to construct large condominium complexes to feed into this lucrative new market sector.
This is a result of the government decision allowing women in Kuwait to avail loans worth $254,684 (70,000 Kuwaiti dinars), the study said.
The lack of mortgage options had so far left a number of Kuwaitis struggling to secure financing to purchase their own home.
However, a government lending scheme offers first-time buyers a loan of $254,684 (KD70,000) and many nationals apply for a 15-year personal loan for another KD70,000. As part of the latest legislation, this lending scheme has now also been extended to women.
The news comes as welcome relief for the Kuwait real estate sector which has witnessed a large slump in activity.
Another report found that the total value of investment in real estate transactions, such as office or retail space offering lucrative returns, amounted to $1.002 billion (KD 281 million) in the first quarter of 2011, a year-on-year rise of 49%.
Over 55% of transactions were in the commercial housing sector, which is targeted mainly at the end user occupiers.
While the total value of transactions amounted to $1.437 billion (KD 395.4 million), down 66% compared to last year, as the sector continued to feel the impact of the downturn in the global real estate sector and a lack of credit for potential homebuyers.
The lack of a fully developed mortgage market has been one of the reasons for the slump in transactions in the housing sector.