DOHA: House rents continue to jump undeterred due to galloping demand for residential units driven by the exploding population.
Latest consumer price index (CPI) details show that house rents climbed 8.2 percent year-on-year in October, pushing the overall rate of inflation to three percent.
In September, the annual increase in house rents was equally high at 8.1 percent. The overall inflation rate was also slightly higher at 3.6 percent.
House rentals jumped by a similar percentage, by 7.9 percent, year-on-year in the month of August this year.
The marginal fall in the overall rate of inflation in October was due to declining food prices, data issued by the Ministry of Development Planning and Statistics for October 2014 suggest.
Rentals are clubbed with fuel (petroleum products) and energy (electricity) in the CPI basket. Since fuel and energy prices remain stable, the rise in the group is clearly due to rent hikes.
The Ministry also attributed the escalating cost of living in the country to rising house rents. “The rise is the highest among all groups,” the development ministry said of house rents while releasing October inflation figures.
Rent, fuel and energy, incidentally, have together the largest share of 32.2 percent in the CPI basket. In simple words, a household is expected to spend 32.2 percent of its monthly income on house rent and fuel and electricity on average.
The second largest head of expenses of a family is transport and communications. Their share in the CPI basket is 20.5 percent, followed by food and beverages, including tobacco (13.2 percent).
Entertainment and recreation form the third largest category of a family expenditure — its share in the CPI basket being 10.9 percent. The smallest share is that of garments and footwear (5.8 percent).
Meanwhile, the country’s population continues to grow unchecked putting pressure on housing stocks. Latest population figures suggest that more than 171,000 people have entered the country between January and October, 2014, most of them newly-recruited foreign workers.
The country’s population as on December 31,2013 was 2.04 million (2,045,239 to be exact). It increased to 2.21 million (2,216,500 to be exact) as on October 31, 2014.
Thousands of new housing units were expected to come on the market in 2014.
Experts say what is driving rents up is demand for housing going up due to the rising population, and the action being taken by the ministry against illegally partitioned villas in which small, unsafe make-shift residential units have been rented out to limited-income expat families.
As more such villas come under the government’s scan, rents will continue to rise as the population and demand are increasing, an expert said. The Peninsula
