Real estate sector suffers sharp decline-shareholders

AMMAN — The real estate market faces challenges in the first month of 2024 due to the uncertain geopolitical climate and weak domestic demand,  according to stakeholders.

Mahmoud Salah, a housing expert, told The Jordan Times, "While sales of apartments and other residential units have slightly improved in January compared with the last couple of months of 2023, the increase remains negligible when considering the financial commitments and operational costs of stakeholders.”  

Salah pointed out that 2023 concluded with weak demand for property and land in general, and the trend has continued into the first month of 2023. 

The total number of properties available for sale significantly exceeds the current level of demand, he added.

Land developers and sector operators have raised concerns about the overall activity in the real estate market during 2023. They also called for urgent interventions, solutions and stimulus packages to support the sector.

In the first 10 months of 2023, the sector’s overall trade volume reached JD5.896 billion, marking a 4 per cent decline.

A recent report from the Department of Statistics (DoS) on construction activity in the Kingdom and building licenses issued in 2023, revealed that the total licensed building area increased by 3.9 per cent to 9.41 million square metres, compared with a total of 9.06 million square metres in 2022.

The report indicated that 24,207 building licences were issued in 2023, representing a 6.1 per cent decrease compared with the 25,790 licenses issued in 2022.

Additionally, 7.8 million square metres of land were licensed for residential purposes, equivalent to 82.5 per cent of the total licensed building area in 2023. Meanwhile, a building construction area of 1.65 million square metres was licensed for non-residential use, representing 17.5 per cent of the total licensed area, the report said. 

“Currently it is hard to make clear predictions about market activity…but what we know for sure is that demand will be weaker during the holy month of Ramadan,” Moatasem Annahar, a land developer, told The Jordan Times on Monday.

He also pointed out that market trends this year are expected to favour buyers as stakeholders continue to offer discounts, aiming for a noticeable rise in purchase demand.