Introduction of long-term residency options, like the Golden Visa, has been instrumental in boosting investor confidence
Bahrain’s Real Estate Market Thrives Amid Economic Growth and Government Initiatives
Bahrain’s property sector is experiencing positive momentum, driven by demographic expansion, enhanced affordability, and supportive governmental policies. Despite broader macroeconomic and geopolitical challenges, the country’s real estate market, like its overall economy, has demonstrated resilience.
A newly released report analyzing Bahrain’s real estate performance for the fourth quarter of 2024, compiled by global property consultancy Savills, provides insights into key market trends, challenges, and emerging investment opportunities within the Kingdom.
The introduction of long-term residency programs, including the Golden Visa, has played a crucial role in bolstering investor confidence. This has translated into a notable increase in property sales, particularly in the residential segment, as more expatriates choose to invest in homeownership rather than leasing.
Bahrain recorded a GDP growth rate of 2.1 percent in 2024, with its expansion primarily fueled by non-oil industries such as manufacturing and financial services. These two sectors collectively contribute 37 percent to the nation’s GDP. With a continued emphasis on economic diversification, upcoming industrial zones and the development of a greenfield airport are expected to attract both local and foreign investments, laying a strong foundation for sustained economic and real estate growth.
Sustained Growth in Bahrain’s Real Estate Sector
Commenting on the findings, Hashim Kadhem, Head of Professional Services, Bahrain, at Savills Middle East, stated:
“The property market in Bahrain continues to demonstrate resilience amid global economic fluctuations. With ongoing infrastructure developments and strategic government policies, Bahrain remains a compelling destination for investors and residents alike. Growth in residential, retail, and industrial segments highlights the Kingdom’s evolving real estate landscape, and this upward trend is anticipated to continue into 2025.”
Robust Residential Market Performance
The residential sector has witnessed steady price growth, with high-end apartments appreciating by 1.4 percent year-on-year, while villa prices have remained consistent. This trend reflects a rising demand for premium housing as buyers increasingly seek modern, amenity-rich developments.
Demand for spacious and well-designed homes has been particularly evident in the rental market, where lease rates surged by 23 percent across the country in 2024. The Capital Governorate accounted for nearly 48 percent of all rental transactions, underscoring its significance in Bahrain’s housing sector.
Popular real estate hubs such as Diyar Al Muharraq, Manama Seafront, and Juffair continue to record strong transactional activity, maintaining their reputation as prime locations for property investment.
In response to growing demand, developers have been launching mixed-use projects that seamlessly blend residential, commercial, retail, and recreational spaces. Meanwhile, the Urban Planning and Development Authority’s recent expansion of residential-use land by 208,000 square meters aims to accommodate the country’s increasing housing needs.
Office and Retail Segments Face Challenges
Despite the residential sector’s strong performance, Bahrain’s commercial office market has encountered hurdles, with limited demand and relatively stagnant rental growth throughout 2024. However, upcoming developments such as SayaCorp Tower and the Future Generation Tower, set for completion in 2025, may introduce further market shifts.
In contrast, the industrial sector remains a key driver of economic diversification. Bahrain’s manufacturing industry continues to fuel demand for warehouse space, with larger facilities experiencing a 2.1 percent year-on-year rental increase, while smaller units have maintained stable leasing rates.
As the government continues investing in infrastructure and economic initiatives, the industrial property segment is expected to sustain steady growth, reinforcing its role as a cornerstone of Bahrain’s economic transformation.
