Doha, Qatar: Qatar’s construction sector is forecast to grow by 2.4 percent in 2027, with improving sentiment in the real estate market offering support to the industry’s outlook, according to the latest report by Fitch Solutions.
The data highlighted a notable shift in market sentiment in recent months, particularly following an improvement in Qatar’s Real Estate Price Index (REPI), which increased by 5.7 percent year-to-date as of October 1, 2026.
Experts at Fitch Solutions said, “This has largely contributed to growing confidence that the long-standing issue of oversupply has been addressed through supportive legislation and dovish policy (implemented in 2025).”
The research entity noted that the REPI has significant methodological limitations, as it measures the average real estate sales price per unit sold without distinguishing between residential and commercial transactions.
Analysts suggest that the recent increase in the REPI may instead reflect a growing tendency among households to purchase higher-value properties, pushing up average transaction values without indicating a meaningful appreciation in the wider housing market.
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“Households are increasingly purchasing more expensive houses, pushing up the median transaction value without implying any significant growth in underlying asset value,” it said, highlighting that the assessment is supported by National Planning Council household unit sales data, which points to a slight decline in property values. Meanwhile, ValuStrat’s independently produced housing valuation metric, which incorporates adjustments for property characteristics, indicates that valuations have remained broadly flat over the year.
Fitch Solutions emphasised that lower interest rates and strong performance in global equity markets are helping to build momentum in the high-end residential segment, where demand could benefit from improved financial conditions and greater wealth creation.
Nevertheless, the report mentions that structural challenges are likely to constrain a more widespread recovery. “High income and wealth disparity, as reflected in Qatar’s Gini coefficient of 46.2 (World Economics), will continue to weigh on the sector,” it said, adding that the market is unlikely to return to 2016 levels in the years ahead.
Beyond Qatar, Fitch Solutions also revised its outlook for the wider Middle East and North Africa (MENA) construction industry, forecasting a real contraction of 4.3 percent in construction gross value added (GVA) in 2026, followed by a recovery of 4 percent in 2027.
“The GCC faces a significantly different economic backdrop,” the report said. “Since the outbreak of the (Middle East) conflict, financing conditions have tightened as institutions adopt a ‘risk-off’ stance to prioritise liquidity management.” It further added, “We estimate that the residential sector, in terms of construction activity, may be especially sensitive to an increasing policy rate.”
