Manama: Qatar's villa rents are likely to plummet further as businesses other than beauty parlours, nurseries and health clinics currently operating from villas in residential areas have been asked by the government to move to commercial premises starting in November.
Numerous villas currently being used as offices are expected to be vacant as a result and come on the rental market for residential use, thus adding to already abundant supplies, Qatari daily The Peninsula reported.
Real estate experts say they expect the villa rental market will receive a further jolt by the end of this year and a serious spillover impact might also be felt by apartment rents.
"As people are likely to move to villas from higher-end apartments, their rents might also come down, as housing supplies already far exceed demand," a real estate expert said, quoted by the newspaper.
Currently, a high number of law offices and audit, engineering and architectural consultancies are housed in villas in residential communities, after the government allowed them to operate from there when there was a serious shortage of commercial space.
But now that commercial space is available in plenty, among estimates of 1.7 million square metres of commercial space is available in Doha, the offices have been asked to move from the villas.
Abundant supplies of commercial space have led to a considerable drop in rentals. From 400 riyals (Dh403) per square metre during the time of the shortage, for example, the rent in the towers area of West Bay has come down to between 180 riyals and 200 riyals, according to the daily.
Small offices operating from villas would nevertheless be paying three to four times what they are paying as rent for villas.
"The average monthly rent of a villa for commercial use is between 20,000 and 25,000 riyals, while in the West Bay this would work out to between 60,000 and 80,000 riyals at the minimum. We small businesses can hardly afford such rents," said an official of a law firm operating from a villa.
The rent for a villa for residential use is between 10,000 and 12,000 riyals.
The Ministry of Municipality and Urban Planning has already stopped issuing new licences to consultancies that want to operate from villas.
Beauty parlours, nursery schools and clinics will be licenced to operate from villas based on the requirement for these facilities in a residential area. However, if competent authorities believe that a particular locality has sufficient adequate facilities, they will not issue a new permit.