01/04/2026 04:22 AST
Bahrain's real estate market recorded strong growth in transaction activity in 2025, even as prices and rents declined across several segments, highlighting uneven performance across the property sector, according to leading real estate industry expert CBRE.
The Survey & Land Registration Bureau recorded a total of 29,777 real estate deals for the year, up 19.8% from 2024.
The total transaction value jumped 51.6% to BD1.6 billion ($4.2 billion) with both figures marking their highest levels in a decade.
This increase came as Bahrain's economy maintained modest growth, stated CBRE in its report.
GDP is forecast to expand 2.1% in 2025, supported by the non-oil sector, according to Oxford Economics, though underlying momentum remains tempered by base effects from early 2024. Inflation averaged just 0.1%, with many consumer goods in deflation.
Despite higher transaction volumes, residential prices continued to weaken. Average apartment sale prices fell 4.4% year-on-year to BD547 per sq m, extending a downward trend since 2023.
Prices remained highest in the Capital Governorate, while the Northern and Southern Governorates recorded the lowest levels. Villa prices also declined, slipping 3.5% to an average of BD490 per sq m.
According to CBRE, the rental rates followed a similar pattern. Apartment rents edged down 1.4% to an average of BD440 per month, while villa rents fell 4.1% to BD924, reflecting softer demand conditions.
In the commercial segment, prime office rents stabilised after a prolonged period of decline, as limited occupier demand and rising supply weighed on the market. Leasing activity was driven largely by existing tenants upgrading space, while demand for co-working offices increased amid a shift toward more flexible workspaces.
On the retail sector, CBRE said it remained under pressure, with average occupancy across major shopping centres falling to 63.3% in the second half of 2025.
Only a third of tracked malls operated above 80% occupancy, as store closures and a shift toward more affordable brands underscored weaker consumer spending, it stated.
At the same time, new retail formats continued to emerge, particularly smaller, experience-focused developments, even as overall mall performance softened.
In contrast, the hospitality sector recorded gains across key metrics. Revenue per available room rose 6.3%, while occupancy increased to 55.7%, supported by rising visitor numbers. Passenger traffic at Bahrain International Airport climbed to 9.74 million, continuing its post-pandemic recovery.
Separately, Cityscape Bahrain 2025 showcased 91 developments and featured major project announcements, including large-scale residential and mixed-use schemes, signalling ongoing investor interest in the kingdom's property market.
Overall, Bahrain's real estate sector in 2025 was characterised by robust transaction growth alongside declining prices and rents, pointing to increased market activity but continued pressure on valuations across segments.
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