Oman Planning 62,800 New Residential Units And 5,800 Hotel Rooms By 2030, Cavendish Maxwell Report Reveals

Oman's commitment to expanding its residential and hospitality sectors is evident in its ambitious plans to introduce a significant number of residential units and hotel rooms to the market. By 2030, the country aims to deliver 62,800 new homes, 5,500 of which are expected this year, in alignment with Oman's strategic goals.

This effort is part of Oman Vision 2040, which seeks to diversify the economy away from its traditional oil base, aiming for non-oil sectors to contribute 90% of the economy. The vision also anticipates the country's population, currently at 5.3 million, to surge to 7.7 million by 2040, fueled by both Omani nationals and expatriates, highlighting a growing demand for housing.

The hospitality sector is also set to flourish, with plans to add 5,800 hotel rooms to the existing inventory over the next five years, marking a 25% increase. This expansion includes the opening of 35 new hotels and resorts by 2030, indicating a strategic push to bolster tourism and hospitality as key pillars of the economy. This growth in the hospitality sector complements the residential expansion, showcasing Oman's comprehensive approach to development.

Khalil Al Zadjali, Head of Oman at Cavendish Maxwell, underscored the significance of this growth, stating, "Oman is undergoing a meaningful economic transformation, with strong momentum in non-oil sectors and a growing population driving demand across real estate and infrastructure. Vision 2040 is not just a plan — it's a commitment to a sustainable, knowledge-driven, globally competitive future. As the country moves forward with the 2040 agenda, stimulating investment in the real estate sector will be of increasing importance.

"Government-led initiatives to attract foreign and local investment can play a key role in ensuring long-term housing market resilience, while at the same time supporting national development priorities. However, given the possibility of demand outpacing supply, proactive planning will be essential in avoiding a potential shortfall."

However, despite these developments, challenges remain. Oman's rapid population growth might lead to a future shortfall in residential property supply. Cavendish Maxwell suggests that an additional 340,000 new homes may be required to maintain a sustainable 90% occupancy rate, highlighting the need for proactive planning and investment to meet this demand.

The residential sector is currently stable, with an average occupancy rate of 85.2% across all units. Villas and Arabic houses enjoy a slightly higher rate of 87.5%, compared to apartments at 80.8%, indicative of the diverse housing preferences in the country. The report also highlights a 3% increase in apartment occupancy levels in 2024, compared to the year before.

Integrated Tourism Complexes (ITCs) are set to play a significant role in Oman's future, offering non-Omani nationals the opportunity to own freehold property. These complexes, which are part of Vision 2040's aim to diversify the economy, are being developed in strategic locations across the country. ITCs provide more affordable pricing compared to other regions in the GCC, with apartment sales prices ranging between 800 to 1,100 OMR per square metre, and villa prices between 750 to 1,000 OMR per square metre. This affordability, combined with similar rental yields to those found in Dubai, Abu Dhabi, and Doha, positions Oman's ITCs as an attractive investment option.

Branded residences are emerging as a preferred choice for investors and end-users seeking premium living options. Properties such as La Vie by Tivoli Hotels and Residences, St. Regis by Marriott, and Mandarin Oriental-branded residences offer luxury at varying price points, catering to a range of preferences and budgets.

Tourism in Oman is experiencing growth, with the country's four airports handling 14.5 million passengers in 2024, a 2.5% increase from the previous year. Hotel guests and revenue have surpassed pre-pandemic levels, with 2.15 million guests staying in 3-5 star hotels in 2024, generating a 6.1% increase in hotel revenue. This positive trend is expected to continue, supported by government initiatives and increasing investor confidence.

The expansion of the real estate market, alongside the targeted growth in hotel and resort offerings, positions the Sultanate as a burgeoning hub for both local and international investors. However, the challenge of matching the pace of development with the growing population and ensuring adequate supply remains a critical focus for the future.