The report highlighted a clear shift in activity toward outer urban areas, especially in the commercial and investment segments, signaling heightened investor appetite for rental and income-generating assets.

The commercial sector led this remarkable performance, recording record-breaking sales of 441 million dinars. This was largely due to several major transactions involving commercial plots in the Ahmadi Governorate, including 240 million dinars worth of deals concluded in August alone.

Such activity underscores renewed investor confidence in commercial real estate, bolstered by expectations of stable returns and new development opportunities. Despite historical fluctuations in this sector, the current surge suggests a strong recovery momentum driven by both private and institutional investors.

Meanwhile, growth in the residential sector remained subdued, constrained by affordability challenges and limited supply.

Sales in this segment reached 396 million dinars during the third quarter, marking a 5.3% quarterly decline but a modest 3.2% increase year-on-year. Interestingly, the number of residential transactions grew by 15.6%, indicating higher demand in lower-priced areas such as Ahmadi and Jahra.

This trend reflects a shift in buyer focus toward more affordable housing options amid rising living costs and constrained household budgets.

In the investment property segment, sales remained robust at 407 million dinars, supported by a 7% increase in bank lending to the real estate sector during July and August.

Although annual growth slowed to 28%—down from an exceptional 116% in the previous quarter—the sector continues to display resilience, aided by recent regulatory reforms related to investment housing and foreign ownership. These changes have contributed to increased investor confidence and diversified market participation, particularly among institutional and regional investors.

Excluding commercial activity, overall real estate sales growth across the residential and investment sectors slowed to 14.5% year-on-year, down from 61% in the previous quarter.

Nevertheless, NBK’s report emphasized that the underlying fundamentals remain strong, supported by improved financing conditions and government-backed development initiatives. The anticipated enactment of the Real Estate Finance Law, alongside possible interest rate cuts, is expected to sustain momentum in the coming quarters by enhancing liquidity and expanding access to credit.

On the policy front, the Public Authority for Housing Welfare (PAHW) has adopted a strategic roadmap aimed at strengthening partnerships between the public and private sectors to accelerate housing development.

The plan envisions the implementation of large-scale projects under a public-private partnership model, with the first phase covering key areas such as Al-Mutlaa, East Saad Al-Abdullah, and joint projects in Jaber Al-Ahmad and West Saad Al-Abdullah. This initiative seeks to alleviate Kuwait’s housing shortage, with registered housing applications reaching 103,110 by mid-July.

In line with this strategy, PAHW signed an investment contract in July for a 12,575-square-meter mixed-use project in the Qairawan area.

The authority also reported notable progress on major infrastructure projects in South Saad Al-Abdullah and South Sabah Al-Ahmad cities, several of which were completed ahead of schedule. However, data from MEED magazine revealed that the overall value of housing projects awarded in the third quarter fell sharply to 20 million dinars, compared to 100 million dinars in the previous quarter, highlighting potential execution bottlenecks despite strong planning activity.

On the financial side, Kuwait Credit Bank approved housing loans worth 61 million dinars during the third quarter—up 28% from the previous quarter—signaling a rebound in financing activity after a four-year low earlier in the year.

However, the value of disbursed loans declined by 14% to 82 million dinars, suggesting that project completion and disbursement processes may still be facing delays. Nonetheless, the upward trend in approvals points to renewed confidence in the housing market and stronger demand from eligible citizens for government plots.

The NBK report also highlighted a slowdown in real estate price growth during the third quarter, with its Real Estate Price Index rising by only 1.4% year-on-year, compared to 2.9% in the previous quarter. The decline was mainly driven by a 1.8% drop in residential property prices, partially offset by a 5.3% increase in investment property values.

Despite the moderation, overall prices remain above last year’s levels, reflecting underlying market resilience and sustained investor interest.

Looking ahead, the outlook for Kuwait’s real estate market remains cautiously optimistic. The upcoming implementation of the Anti-Monopoly Law on Vacant Lands in January 2026 is expected to curb speculative hoarding and encourage more efficient land use. Coupled with the Real Estate Finance Law and potential monetary easing, these measures could help stabilize prices and support steady market growth.

While challenges persist—particularly in residential affordability and project execution—the overall trajectory points to a more balanced and dynamic real estate sector poised for sustainable expansion.