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Manama's property market has shown remarkable resilience and growth, with residential prices experiencing significant appreciation over the past five years.
The capital city's real estate sector continues to benefit from strong rental yields, steady population growth, and strategic government investments in infrastructure projects.
If you want to go deeper, you can check our pack of documents related to the real estate market in Manama, based on reliable facts and data, not opinions or rumors.
Manama's property market shows strong fundamentals with apartment prices up 75% over five years and rental yields ranging from 8.3% to 11%.
The market benefits from steady housing supply delivery, growing foreign investment, and moderate price growth forecasts of 4-7% annually for the next three years.
| Market Indicator | Current Status | Trend/Forecast |
|---|---|---|
| Residential Price Growth (5-year) | Apartments: +75%, Villas: +39% | 11-15% annual compound growth |
| Rental Yields | 8.3% to 11% for apartments | Outperforming GCC capitals |
| Housing Supply (2024) | 1,421 units delivered | Consistent with decade average |
| Population Growth | Current: 1.6 million | Reaching 2.0 million by 2030 |
| GDP Growth (5-year avg) | 2.6% to 3.9% annually | Non-oil sector driven |
| Price Forecast (2026-2028) | Residential: 4-7% annually | Moderate steady growth |
What has been the average annual price growth for residential properties in Manama over the past five years?
Manama's residential property market has delivered exceptional returns over the past five years.
Apartments in Manama have experienced a remarkable 75% total price appreciation over the five-year period, translating to an average annual compounded growth rate of 11-15%. Villas have shown more moderate but still substantial growth at 39% total appreciation over the same timeframe.
The growth pattern has been selective rather than broad-based in recent years, with prime locations and well-positioned properties commanding premium appreciation rates. High-end developments in areas like Juffair, Amwaj Islands, and Seef District have consistently outperformed the market average.
This performance significantly outpaces inflation and many other investment alternatives in the region, making Manama residential properties an attractive asset class for both local and international investors.
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How many new housing units were delivered in Manama last year, and how does that compare with the average annual supply over the last decade?
Manama delivered approximately 1,421 new housing units in 2024, primarily through social housing initiatives.
This delivery figure aligns closely with the average annual supply maintained over the past decade. The consistent supply pattern reflects the government's systematic approach to housing development through national housing projects and strategic urban planning.
The steady supply has helped maintain market balance without creating oversupply conditions that could negatively impact property values. Most new units have been absorbed efficiently by the growing population and expanding household formation in the capital.
The controlled supply approach has contributed to maintaining healthy price appreciation and rental yield levels across different property segments in Manama.
What is the current rental yield percentage for apartments in Manama, and how does it compare with yields in other GCC capitals?
Manama offers some of the most attractive rental yields in the GCC region for apartment investors.
Current gross rental yields for apartments in Manama range from 8.3% to 11%, significantly outperforming most other major GCC capitals. By comparison, Riyadh, Jeddah, and Dammam typically offer yields between 6-8%, while Dubai properties generally yield 5-7%.
This yield advantage stems from Manama's relatively affordable property acquisition costs combined with strong rental demand from the city's diverse expatriate population and growing financial services sector. The yields are particularly attractive in established neighborhoods with good infrastructure and amenities.
The higher yields make Manama an excellent choice for income-focused real estate investors seeking regular cash flow from their property investments.
How many property transactions were recorded in Manama in the last 12 months, and what was the total value of those deals?
Manama's property transaction activity demonstrates robust market liquidity and investor confidence.
Based on Q1 2023 data showing approximately 6,336 property transactions in the quarter, annualized estimates suggest around 25,000 property transactions occurred in Manama over the last twelve months. This represents healthy market turnover and active buying and selling activity.
The total transaction value for Bahrain's real estate market exceeded BHD 1 billion over the last twelve months, with Manama representing the largest share of this activity as the country's primary commercial and residential hub.
These transaction volumes indicate strong market confidence and liquidity, making it relatively easy for investors to both enter and exit property positions when needed.
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What is the forecasted population growth in Manama over the next 10 years, and how many new households does that represent?
Manama is positioned for substantial population growth that will drive continued housing demand.
Bahrain's population is forecasted to reach 2.0 million by 2030, up from the current 1.6 million, representing a growth of 400,000 people over the next 5-6 years. Manama, as the capital and economic center, will capture a significant portion of this population increase.
With an average household size of approximately 4.0 persons, this population growth translates to roughly 50,000 new households that will require housing accommodation. This represents substantial underlying demand for both rental and purchase properties in Manama.
The population growth is driven by continued economic development, job creation in financial services, and government initiatives to attract foreign investment and residents through various residency schemes.
What percentage of Manama's real estate market is driven by foreign buyers, and has this share been increasing or decreasing?
Foreign investment plays an increasingly important role in Manama's property market.
Foreign buyers are concentrated in designated freehold zones where 100% foreign ownership is permitted, including popular areas like Juffair, Amwaj Islands, and Seef District. While exact percentages aren't publicly disclosed, foreign buyer activity is substantial in these premium locations.
The trend shows growing foreign buyer participation, supported by government incentives and residency-through-investment schemes that make property ownership attractive to international investors. Recent policy changes have made the investment process more streamlined and transparent.
This growing foreign interest provides additional demand support and helps maintain property values, particularly in the higher-end market segments where international buyers typically focus their investments.
What is the current office vacancy rate in Manama, and how has it shifted over the past three years?
Manama's office market is undergoing transformation toward more flexible and modern workspace solutions.
While precise recent vacancy figures aren't publicly available, the Manama office market has experienced shifting demand patterns over the past three years. Traditional office spaces have faced some vacancy challenges, but this has been offset by growing demand for flexible co-working spaces and hybrid work arrangements.
The market has seen movement toward modern, well-equipped office buildings in prime locations like the financial district, while older or poorly located office stock has experienced higher vacancy rates. Landlords have adapted by offering more flexible lease terms and investing in building upgrades.
The overall trend points toward a more selective office market where quality and location command premiums, while substandard properties face ongoing challenges.
How many large-scale infrastructure or real estate projects (worth over $100 million) are currently under construction in Manama?
Manama is experiencing significant development activity with multiple major projects reshaping the city's skyline.
Several large-scale projects worth over $100 million are currently under construction, including:
- Diyar Al Muharraq - A massive mixed-use development on reclaimed land
- Bahrain Marina - Luxury waterfront residential and commercial complex
- Onyx SkyView - High-end mixed-use tower development
- Government-backed infrastructure initiatives including road networks and utilities
- Multiple luxury residential towers in Juffair and Seef districts
These projects represent billions of dollars in investment and will significantly increase the supply of premium residential and commercial space in Manama. The developments are strategically located to serve both the local population and international investors seeking high-quality properties.
The construction activity demonstrates strong developer confidence in Manama's long-term growth prospects and continued demand for modern real estate products.
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What has been the average annual GDP growth rate of Bahrain over the past five years, and how strongly is it correlated with property demand in Manama?
Bahrain's economic performance provides a solid foundation for Manama's property market growth.
Bahrain's average annual GDP growth rate over the past five years has ranged from 2.6% to 3.9%, driven primarily by non-oil sectors including information technology, transport, manufacturing, and financial services. This diversified growth pattern creates sustainable demand for commercial and residential properties.
The correlation between GDP growth and property demand in Manama is strong, particularly because the non-oil sector growth directly supports employment and business expansion in the capital. Financial services sector growth, in particular, drives demand for both office space and high-quality residential properties for professionals.
The steady economic growth has supported consistent property market performance and provides confidence for future market stability and growth prospects in Manama.
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What is the mortgage interest rate currently available in Bahrain, and how has it moved compared to last year?
Bahrain's mortgage market has experienced moderate interest rate adjustments in line with regional trends.
As of September 2025, mortgage interest rates in Bahrain have shown low-to-moderate increases over the past year, following GCC regional trends and responding to rising US interest rates that influence global monetary policy. The exact current rates vary by lender and loan terms but remain competitive within the regional context.
The rate increases have been gradual rather than dramatic, allowing the property market to adjust without experiencing significant demand shock. Most borrowers have been able to manage the modest rate increases through improved lending terms or longer amortization periods.
Despite the rate increases, mortgage accessibility remains good for qualified buyers, and the financing environment continues to support property market activity in Manama.
What percentage of new real estate projects in Manama are residential versus commercial, and how does this balance compare to five years ago?
Manama's development pipeline continues to be dominated by residential projects, though commercial development is gaining momentum.
| Project Type | Current Share | Five Years Ago |
|---|---|---|
| Residential | 65-70% | 75-80% |
| Commercial | 20-25% | 15-18% |
| Mixed-Use | 10-15% | 5-7% |
The majority of recent projects in Manama remain residential, reflecting ongoing population growth and housing demand. However, commercial development has accelerated notably in key districts like Seef and Bahrain Bay, where office towers, retail centers, and hospitality projects are increasingly common.
Mixed-use developments have also gained popularity, combining residential, commercial, and retail elements in single projects. This trend reflects developer recognition of changing lifestyle preferences and the desire to create integrated communities.
The evolving balance shows Manama's maturation as a business and residential center, with increased emphasis on creating comprehensive urban environments rather than single-purpose developments.
What is the forecasted price change (in %) for Manama's residential and commercial properties over the next three years, according to leading real estate consultancies?
Leading real estate consultancies project moderate but steady growth for Manama's property market over the next three years.
Residential property prices in Manama are forecasted to increase by 4-7% annually from 2026 to 2028, according to leading consultancy estimates. This represents a more moderate pace compared to the exceptional growth of recent years, reflecting market maturation and normalization of price levels.
Commercial property price changes are expected to remain flat or show modest growth, heavily dependent on project location and specific demand factors. Prime commercial locations may see appreciation while secondary areas may experience more limited growth.
The moderate growth forecasts reflect realistic expectations based on economic fundamentals, population growth, and supply-demand balance. This steady appreciation rate provides good investment returns while maintaining market sustainability and affordability for end users.
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Manama's property market presents compelling opportunities for investors seeking strong rental yields and steady capital appreciation.
The combination of economic diversification, population growth, and strategic infrastructure development positions Manama as an attractive real estate investment destination in the GCC region.
Sources
- Manama Price Forecasts
- Bahrain Price Forecasts
- Market Report Analytics - Bahrain Residential Real Estate Market
- UAE Stories - GCC Real Estate Market Analysis
- Abu Dhabi Fund for Development - Northern City Bahrain
- Bahrain Real Estate Market Trends
- Construction Week Online - Bahrain Real Estate Sales Analysis
- ASK Real Estate Q4 2024 Report
- Bahrain Mirror - Population Growth Projections
- US Trade Gov - Bahrain Construction and Infrastructure