All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.
Yes, the analysis of Muscat's property market is included in our pack
Thinking of buying a property in Muscat? You're not alone!
Many people are drawn to Muscat's Middle Eastern allure and fantasize about owning a luxurious villa or a modern apartment there.
Does it make sense, though? Are property prices increasing in Muscat? What is the price per sqm? Is it better to invest in Ruwi or Al Khuwair? Is there any hidden tax? Where can you get a yield above 7%?
We have all the answers you need.
The SandsOfWealth team has thoroughly explored this market. Actually, we've put all our findings together in a pack. Get it now.
In this article, get ready to receive valuable insights from us.
How is the property market in Muscat?
Is the property market showing growth or decline? Let's analyze the latest data and statistics.
Property types
In Muscat, you can find a variety of properties for sale, including apartments, villas, townhouses, and commercial spaces.
Apartments are often suitable for individuals or small families and come in different sizes. Villas provide more space and are ideal for larger families, often featuring gardens and multiple bedrooms. Townhouses offer a balance between apartments and villas, usually having shared walls and multiple floors.
Commercial properties include offices, shops, and warehouses for those interested in business ventures.
Each type of property offers different features and sizes to cater to various preferences and needs.
Better to buy or rent?
(In case you want it for yourself, not for rental purposes)
If Muscat is your city of choice, you might be considering whether it's better to buy a property or opt for renting in this fascinating capital of Oman.
Without a doubt, you should buy if you want to acquire equity and have more control over your living space.
Want to make a good decision? Check out the property price-to-rent ratio. This metric give an indication of how many years of rental income it would take to cover the cost of buying a property at its current price.
According to Numbeo, the property price-to-rent ratio in Muscat is around 14.37, which is below the world average.
Consider this: the average period it takes to accumulate sufficient rental payments for purchasing a property is merely 14 years.
Property prices in Muscat
On average, according to the last data from National Center for Statistics and Information (NCSI), purchasing a property in Muscat will cost you around $2,830 per square meter.
Obviously, there are significant differences. The value of a square meter for a sea-view property in Muscat might differ from a villa in Al Khuwair. We actually offer a more in-depth analysis in our pack for buying property in Muscat and in Oman.
To put things in perspective, it is 6.7 times less than the property prices in the center of New York.
Moreover, housing prices in Muscat are way cheaper (-57%) than in Dubai.
The most expensive neighbourhoods in Muscat are probably Qurum, Al Khuwair, and Shatti Al Qurum, while the cheapest are likely Ghala, Al Amerat, and Bausher.
Trends
First and foremost, we have to acknowledge that Oman currently ensures a stable environment for investors. The last Fragile State Index that has been reported for this place is 49.5.
Don't overlook this while weighing the pros and cons of buying a property in Muscat.
Also, you have to know that Oman's economy is expected to soar by 13.1% in the coming 5 years, resulting in an average GDP growth rate of 2.6% (according to the IMF).
If you intend to invest in real estate in Muscat it's a good thing because when the economy grows, people often experience an increase in wealth, it typically translates to a surge in housing costs.
Also, in Oman, the average GDP per capita has changed by 3.3% over the last 5 years. It's not much, but the growth is here.
According to this data point, property prices in Muscat might go higher in 2024 and also later on.
Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Oman right now.
Buying property in Muscat
It can be difficult to buy property in Muscat due to the lack of reliable and updated information available. That's why we have created the pack to buy property in Muscat and in Oman.
Buying process
In our pack, we've explained the entire process of buying properties in a detailed way. We've pointed out the mistakes to steer clear of, shared tips for finding properties that give you the best returns, and provided information about taxes and necessary documents.
Now, we're giving you a simplified version of the buying process.
This is the step-by-step process to purchase a property in Muscat:
- Research properties and neighborhoods in Muscat.
- Engage a licensed Omani real estate agent.
- Review property listings and select a property.
- Negotiate the price and terms with the seller.
- Sign a Letter of Intent (LOI) or Sale Agreement.
- Pay a reservation fee to secure the property.
- Conduct due diligence on the property's legal status with the Ministry of Housing.
- Hire an Omani lawyer to prepare the sales contract.
- Obtain necessary approvals, such as from the Ministry of Defense or Royal Oman Police.
- Pay the remaining balance and transfer ownership at the Ministry of Housing.
- Register the property at the Muscat Land Registry.
- Collect the title deed (Mulkiya) and complete the transaction.
Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Oman.
Make a profitable investment in Muscat
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Where to find a property
Find your dream property in Muscat using these websites.
- Oman Property Finder - The top real estate agency in Oman, offering a wide range of properties for sale or rent across the country.
- Savills - A global real estate agency with expertise in residential and commercial properties, offering market insights and property management services.
- OLX by Dubizzle - A free classifieds platform in Oman for buying, selling, and finding a wide range of products and services, including vehicles and properties.
- Tamlik Properties - One of the leading real estate companies in Oman, specializing in buying, selling, and renting properties in Muscat.
- Mawa.om - Oman's leading real estate platform, offering a comprehensive range of properties for rent and sale.
Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Oman.
Which properties for which budget?
As mentioned before, the average price per sqm in Muscat is $2,830. A 1-bedroom property with 60 square meters of space would cost approximately $170,000, while a 2-bedroom with 85 square meters would cost around $241,000.
However, prices will differ based on the attributes of the property and its specific location.
Prime property locations in Muscat tend to come with higher price points. For approximately $690,000, you could consider a residence in Shatti Al Qurum, while a condominium in Al Mouj could be priced at $300,000.
But there are less expensive options in certain locations. You could find a property in Al Khuwair for $130,000, or you may encounter one in Al Mabelah priced at only $110,000.
We give more details about property types and areas in our full pack for buying property in Oman.
Risks and pitfalls
Here are the main pitfalls specific to buying property in Muscat, Oman:
- Non-Omani ownership restrictions: Foreign buyers face limitations on property ownership and potential residency requirements.
- Royal Decree No. 47/2020: New restrictions on non-Omani property ownership in specific areas can limit investment choices.
- No land ownership for foreigners: Non-Omanis cannot own land; they can only buy leasehold properties, which may not appreciate as freehold properties do.
- Limited financing options: Obtaining mortgages as a non-Omani can be challenging, with higher interest rates and stringent eligibility criteria.
- Gentrification risks: Rapid urban development might change the neighborhood character, affecting property values and rental potential.
- Undefined property boundaries: Some older properties lack accurate boundary demarcations, leading to potential disputes with neighbors.
- Environmental regulations: Overlooking coastal development restrictions and environmental impact assessments could lead to legal issues.
- Cultural considerations: Ignoring local customs and community dynamics may result in strained relationships with neighbors and authorities.
We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.
Everything you need to know is included in our Oman Property Pack
Living in Muscat
Living in Muscat is an attractive option, offering a relaxed lifestyle with plenty of outdoor activities and a vibrant culture.
Cost of living
The cost of living in Muscat is generally considered to be quite high, with prices for goods and services often being higher than in other parts of the world. However, the city is home to many expats and offers a range of employment opportunities, making it an attractive destination for those looking to relocate.
Here are some examples to better understand the cost of living in Muscat, Oman:
- Rent for a one-bedroom apartment in the city center: $780/month.
- Monthly public transportation pass: $65.
- Dinner for two at a mid-range restaurant: $52.
- 1 liter of gasoline: $0.55.
- Utilities (electricity, water, cooling) for an 85m² apartment: $130/month.
- Gym membership at a local fitness center: $78/month.
- Ticket to a movie at a cinema: $16.
- Cup of traditional Omani Kahwa (coffee) at a café: $2.
Neighbourhoods
Since our intention is to provide information clearly, we've created a summary table outlining the different neighborhoods in Muscat. For yields, prices and rents, check our property pack.
| Neighborhood | Description | Strengths | Weaknesses |
|---|---|---|---|
Al Qurum | Al Qurum is a popular upscale neighborhood known for its beautiful Qurum Beach, luxurious hotels, and shopping malls. It offers a vibrant atmosphere with various entertainment options. | Beautiful beachfront, luxurious amenities, lively entertainment scene. | Higher cost of living, heavy traffic at times. |
Al Khuwair | Al Khuwair is a well-established residential and commercial area with a mix of modern apartments, offices, and local businesses. It provides convenient access to various services and public facilities. | Central location, diverse commercial options, good transportation links. | Can be crowded, limited green spaces. |
Madinat Al Sultan Qaboos | Madinat Al Sultan Qaboos is a prestigious neighborhood featuring grand villas, diplomatic missions, and exclusive shopping centers. It's known for its security and upscale living. | High-end residential options, diplomatic presence, secure environment. | Restricted access in some areas, limited affordable housing. |
Ruwi | Ruwi is a bustling commercial district and the traditional heart of Muscat. It has a mix of modern and older buildings, offering a glimpse of the city's history and contemporary life. | Commercial hub, historical charm, diverse retail and dining options. | Heavy traffic, limited green spaces, noise pollution. |
Al Ghubrah | Al Ghubrah is a well-connected neighborhood with easy access to the Sultan Qaboos Highway and various amenities like schools, hospitals, and shopping centers. It's a family-friendly area with a mix of residential properties. | Good infrastructure, family-oriented, proximity to essential services. | Limited public parks, potential for traffic congestion. |
Muttrah | Muttrah is the historical heart of Muscat and features the famous Muttrah Souq, a traditional market. It offers a blend of cultural heritage, picturesque corniche, and proximity to tourist attractions. | Historic charm, traditional market, scenic waterfront. | Older infrastructure, narrow streets, limited parking. |
Al Mawaleh | Al Mawaleh is a fast-growing neighborhood with a mix of residential and commercial developments. It offers modern housing options and easy access to Muscat Expressway. | Newer infrastructure, diverse housing, proximity to major highway. | Ongoing construction, potential traffic congestion. |
Al Hail | Al Hail is a suburban area with several residential compounds and local amenities. It's a quiet and family-friendly neighborhood with easy access to Sultan Qaboos University. | Quiet living environment, proximity to university, local amenities. | Limited public transportation, less vibrant nightlife. |
Azaiba | Azaiba is a lively area with a mix of residential and commercial properties. It features several shopping centers, restaurants, and parks, making it a popular choice for families. | Abundance of amenities, family-oriented, lively atmosphere. | Heavy traffic during peak hours, limited green spaces. |
Life in Muscat
Muscat is the capital of Oman and is the country's economic hub. It is a major trading center in the region, with a growing economy driven by the oil and gas, tourism, and logistics sectors.
What expats usually like the most in Muscat is its vibrant souqs with traditional goods and its stunning beaches with crystal clear waters.
An important point to note is that Muscat is an extremely safe city - the crime index is around 20, which is an exceptional score. The culture of Muscat is one that values respect for authority and the law, leading to a low crime rate.
Access to healthcare in Muscat is generally good, with a wide range of both private and public healthcare facilities available.
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Renting out in Muscat
If you're interested in buying property not to live in, but to rent out and generate income, this section is for you.
Long-term
Tenant Profiles in Muscat
According to the data reported by Wikipedia, the home ownership rate in Oman is 83%, which is rather high.
It is probably a bit less in Muscat though.
If you decide to buy and rent out to long-term tenants, you should target expatriates from the oil and gas industry, as well as professionals and families looking for a place to live in the city. Students and short-term visitors are also prevalent in the rental market in Muscat.
Here is a little summary table we've made for you.
| Property type and area | Profiles of potential tenants | What they are looking for | Expected monthly rent in $ |
|---|---|---|---|
Apartment in Al-Khuwair | Professionals, families | Central location, modern amenities | $800 - $1500 |
Villa in Qurum | Expats, families | Quiet residential area, proximity to beach | $1500 - $3000 |
Studio in Al-Mouj | Young professionals | Integrated community, waterfront views | $1000 - $2000 |
Apartment in Al-Ghubrah | Local residents, students | Convenient amenities, family-friendly | $600 - $1200 |
Flat in Al-Seeb | Local residents | Affordability, urban lifestyle | $300 - $800 |
Villa in Al-Mawaleh | Families, expats | Suburban living, spacious accommodations | $1200 - $2500 |
Apartment in Madinat Sultan Qaboos | Professionals, expats | Central location, upscale lifestyle | $1000 - $2000 |
Rental yields
Nowadays, Muscat offers some opportunities in terms of rental yields. Actually, you can easily achieve 7 or 8% due to the high demand for rental properties in the city.
Apartments in the suburbs of Muscat tend to offer the best rental yields because they are more affordable for tenants and have a lower cost of maintenance for landlords. Additionally, the demand for rental units in the city centre is usually higher, which allows landlords to charge higher rents.
For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.
Finally, be aware that rental incomes in Muscat are taxed at 2%, which is very advantageous.
Short-term
You could also decide to rent short-term to vacationers, business travelers, and military personnel visiting Muscat. Short-term rentals may also be attractive to those attending special events such as conferences or festivals in the area.
If you decide to go with that option, look for properties in Al Khuwair, Madinat Qaboos, and Muttrah. These areas offer a variety of properties and amenities close to the city center.
There are approximately 480 active Airbnb listings in Muscat, reflecting a dynamic short-term rental market. The average daily rate stands around $92.
You have the opportunity to generate a nice additional income stream then. According to online testimonials and analytics platform like AirDNA, Guesty and Inside Airbnb, people who offer short-term rentals in Muscat can make around $700 per month. Also, the average occupancy rate is estimated at 35%.
Is it worth buying real estate in Muscat then?
Buying property in Muscat can be a fantastic idea if you're planning to settle down in this vibrant Middle Eastern city for the long haul. It's a wise move if you want to put down roots and have control over your living space. The property price-to-rent ratio in Muscat is quite favorable, suggesting that over time, buying property can be more financially rewarding than renting.
Plus, Muscat's property market has displayed stability, and the country's growing economy hints at the potential for property values to rise. If you've got your heart set on a specific neighborhood like Al Qurum, Al Khuwair, or Shatti Al Qurum, and you're planning to stay there for an extended period, buying property in that area can offer a fantastic lifestyle and investment opportunity. Oman's reputation for stability in the region also adds confidence to your investment.
However, if you're in Muscat for a short stint, buying property may not be the best move. Property transactions involve significant costs, such as taxes and fees, which could outweigh the benefits if you plan to sell in the near future. Moreover, non-Omani buyers face property ownership restrictions and potential residency requirements, making it less attractive for expats with short-term plans.
Additionally, if you're not comfortable with the rapid urban development and potential changes in neighborhood character or if you're concerned about undefined property boundaries and cultural differences, renting might be a safer and more flexible option.
Ultimately, whether it's worth buying property in Muscat hinges on your long-term goals, financial situation, and comfort with the local real estate landscape.
Make sure you understand the real estate market in Muscat
Don't rush into buying the wrong property in Oman. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.
The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.