HOW BUYERS AND LANDLORDS CAN MONETISE THE PANDEMIC

Diana Valeyra
Senior Property Consultant
Kensington Real Estate

There are two types of mindsets in the times of this pandemic; the first type are the ones who sit on cash and watch in fear, and the second type are those who search for opportunities, understanding that we may never witness prices be as low as they are today. With the market being a buyer and tenants’ market, landlords must ‘stage’ their properties for success. 

Buyers:

Over the past two years, the world has witnessed much negativity fuelled by fears of the global pandemic. But the reality is that there has been an influx of positive investors seizing opportunities at low prices, which may never happen again. Every investor speaks and breathes one important word: yield. And there are only two ways to improve yield. The first is ‘price’ and the second is ‘rent’. Prices for Juffair at BD405/sqm, Amwaj at BD386/sqm and Reef at BD541/sqm have never been witnessed over the last decade, but these are prices we have sold to some of our investors in the last quarter of 2021. We have helped investors achieve yields of 9.5 – 12.5 percent during the pandemic itself, wherein rents have dropped significantly. 

“Be fearful when others are greedy, and greedy when others are fearful” – Warren Buffet. 

The majority of investors who have purchased units have actually been cash buyers, willing to allocate all their savings into a property which is now generating a monthly ROI for them. We currently have properties for sale which are tenanted and therefore offer an immediate income of approximately 10 percent from day one. As the pandemic eases, we will witness a rise in rental rates as well as selling prices, so by purchasing now you will lock in the lower price while enjoying the positive effect of increased rents on your investment yield. 

Landlords:

With regards to landlords; ‘staging’ is, unfortunately, a concept not commonly used in Bahrain. With rents having dropped somewhat dramatically, and a continued supply, it has become a tenant’s market. Properties that are well-kept” and “staged have been moving rapidly in the market. Imagine yourself as the tenant/buyer and the feeling of walking into a beautifully staged property with plush pillows, fresh smells and a table set up and ready to eat on. We have assisted landlords in the entire process and have seen the results. The most fundamental, yet most overlooked, step in making the right property decisions is picking the right property consultant to walk you through it.

This article was published as part of the seventh edition of Property Finder Bahrain’s Trends Report.