Qatars ambitious economic policies have sustained double-digit growth rates while much of the world has struggled over the past few years. But the gas-rich Gulf state may now be overreaching, as a building boom threatens a glut in its property market.

State-owned property developers Barwa Real Estate and Qatari Diar are set to spend QR100bn $27.5bn over the five years to 2016 on commercial and residential projects, according to a national development strategy unveiled last March for the country of 1.7 million people.

Qatar may now be overreaching, as a building boom threatens a glut in its property market.
Qatar building boom threatens a glut in its property market.

The government is backing that with promised public investment worth $95bn during the period, over $65bn of which is expected to be on infrastructure.

Construction frenzy has led to a jump in lending to the real estate sector

But much of the property market is weak, with rents and prices falling. Lending into such a weak market could hurt banks balance sheets while worsening the real estate slump by increasing supply of new homes and offices.

via Qatar building boom risks property slump – Real Estate – ArabianBusiness.com.

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