Qatar faces a steep challenge ahead of the World Cup as its real estate suffers from oversupply. Reuters reported that the country is showing signs of its real estate suffering from decline--particularly the Doha Tower, an award-winning structure that was finished in 2012. Half of the tower currently stands unused.
Ahead of the 2022 World Cup, Qatar faces the uncertainty of a property market with more surplus than sales. The vacant spaces in their apartments mirror what has been the trend for the rest of the Gulf region, as it suffers from a decline in economics. The drop in oil prices is only one of the many effects of the regional slowdown.
Qatar has the added problem of Saudi Arabia's boycott, imposed on the trade, transport, and diplomatic sectors of the country. Bahrain, Egypt, and the United Arab Emirates all support the boycott, backed by allegations that Doha supported Islamic extremists. Qatar has since denied any allegations of support.
Other Gulf countries that showed signs of slipping included the United Arab Emirates. The UAE stocks showed signs of slipping down and bottoming out (in the property sector), according to Bloomberg. Shares from the country have slid and are among the most oversold shares out of the Middle East, Africa, and even in Eastern Europe.
Structural decline led to a 7.4 percent yield for the country. That's not bad by country standards--it is actually above its 11-year average--but it highlights the country's problems. This is considered overweight for UAE shares in the direction of a slide. Analysts added that UAE investors may seek to find affordable alternatives rather than ride out the country's troubles.
Analysts, however, have placed Qatari shares at 'equal-weight' right after the QE Index bounced back to 21 percent, an amount considered high. This is against a loss of 17 percent. The country is facing troubles of its own, but recommendations have been placed at the aforementioned description after Qatari Indexes showed it's still fighting back.
Despite this, residential prices remained down by 10 percent from June 2017. Office prices have also declined by a similar rate. Rents have gone down 20 percent, lower than from 2015. Capital Economic economist Jason Tuvey said that Qatar's property sectors remained to hurt from the blockade of the Gulf nations.
