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Thursday, February 25, 2021

Qatar becomes a buyer’s market for used cars amid energy sector layoffs

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Photo for illustrative purposes only.
Photo for illustrative purposes only.

Qatar’s used car market has been “flooded” with options in recent weeks as several of the country’s largest employers downsize, forcing many departing expats to sell their vehicles during one of the busiest times of year for such sales, an industry expert has said.

Julian White, a sales executive at used vehicle showroom Oasis Cars, said he’s receiving 10 to 15 offers a day from residents looking to sell him their vehicles, roughly double the number of calls he was receiving at this time a year ago.

“There’s been a change in the market … (as) quite a lot of people are leaving (Qatar),” White told Doha News.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

Expats who choose to leave Qatar for good often time their departures to coincide with the end of the school year. As they sell off their possessions, the number of used car listings typically increases in May and June.

But the market has seen even greater growth in recent weeks after employers in the energy sector downsized their staffs in the wake of last year’s collapse in oil prices.

This has made it increasingly difficult for some to sell their used cars. In addition to a new wealth of choice, White said there’s also a consumer confidence issue, as some residents are reluctant to purchase a new vehicle while feeling insecure about their jobs.

Having sold five vehicles on Saturday alone, White added that there are still car buyers in the market, but that many are taking longer to make a purchase as they have more options to choose from.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

Despite Qatar becoming a buyer’s market for used cars, prices have so far failed to fall, White said.

He speculated that some car sellers may have taken out loans to buy their vehicles and need to fetch a certain price in order to settle their debts.

Others, he said, may not fully appreciate how much a vehicle can depreciate or have a sense for how many vehicles are currently being sold in the used car market.

However, he suggested that a drop is imminent.

“Prices are going to have to come down,” White said. “The market is flooded with used cars right now.”

Few inquiries

One resident who does have a firm grasp of the current state of the market is British expat Nat High, who is preparing to leave Qatar and move to the UAE.

Roughly two weeks ago, he said he posted ads for his family’s two vehicles – a 2011 Kia Mohave 4×4 and a 2012 Volkswagen Golf – on three popular online classified sites.

To date, he said he has yet to receive “even the vaguest of inquiries” and is investigating the possibility of shipping the vehicles to the UAE instead of selling them.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

“I would have honestly thought that with plenty of lead time there would have at least been a phone call … (But all) the (used vehicle) websites are flooded,” said High, who wrote about his preparations to leave Qatar on his blog, Bright lights, little city.

He told Doha News that he discussed his asking price with several friends who have either recently bought or sold vehicles in Qatar, and they said his listings were reasonable.

High added that when he paid for a listing on Qatar Sale, the photographer who took pictures of his vehicle told him that he has never been so busy with his job, due to the high number of residents selling their cars.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

Qatar Sale declined to discuss the used vehicle market when contacted by Doha News.

However, the head of another popular online marketplace in Qatar said he’s not convinced that layoffs in the energy sector have led to a glut of used cars for sale.

Qatar Living managing director Bilal Randeree told Doha News that there are currently approximately 700 cars and 450 4x4s listed for sale on the site.

“That’s higher than last year, but not exceptionally so,” he said, noting that Qatar’s population and levels of internet access have been increasing.

At the same time, QL has been working to capture a larger share of the used car market and attracting more listings.

“The pool (of people selling their vehicles online) has been growing,” Randeree said.

What’s been your experience buying or selling a used car in Qatar? Thoughts?

50 COMMENTS

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A_qtr
A_qtr
5 years ago

Hey Peter, here’s a lead on a more interesting story.. The actual lay offs … Who got chopped .. Why … Interview someone them.. Are those impacted have a different job waiting… The Qataris who go fired.. How will it impact the locals and the mentality of “you can’t fire me..”

Btw before every summer break and in every summer there is a slump in car sales.. School out and expats leaving… Folks getting rid of their cars for quick cash for a eid/summer vacation etc

MIMH
MIMH
5 years ago
Reply to  A_qtr

That would be real news. I’ve been involved in firing Qataris in the past but it’s the exception rather than the rule. I remember a guy telling me he would never get fired for doing nothing, well except maybe if he punched the GM in the parking. Then he thought for a moment and then said, probably final warning….

R
R
5 years ago
Reply to  A_qtr

Well said, how about some serious reporting

Anonymouse
Anonymouse
5 years ago
Reply to  A_qtr

It would be interesting, but very difficult I think. The companies are being very quiet. You are right that there are lots of stories our there about people being terminated by text message in the middle of the night, threatened to go quickly and quietly or forfeit their ESB, etc. From my observations, people are being punted out of the country so quickly it would be difficult to arrange interviews with them.

KM Sandeep
KM Sandeep
5 years ago

I wanna buy one, who can help me. ?

A_qtr
A_qtr
5 years ago
Reply to  KM Sandeep

QatarSale.com

Al Kohol
Al Kohol
5 years ago

Salwa road FTW

Yacine
Yacine
5 years ago

Does that mean that rent will decrease? Because so far I haven’t seen any property that is being leased for the same price as last year or less. If that happens then I will believe the story of the massive layouts in the energy sector. For now it looks like it is being blown out of proportion.

MIMH
MIMH
5 years ago
Reply to  Yacine

Landlords would rathe places stay empty then accept a drop in rent. It actually means they are losing money over the term of a lease if they filled it at a lower price. Economics is not their strong point for many.

A_qtr
A_qtr
5 years ago
Reply to  MIMH

Landlords would rather sacrifice their youngest born to the real estate gods than lower rent

MIMH
MIMH
5 years ago
Reply to  A_qtr

How jewish

Yacine
Yacine
5 years ago
Reply to  MIMH

You wouldn’t get away with it if you say it in Europe, even in an online comment

MIMH
MIMH
5 years ago
Reply to  Yacine

Well actual you would. It’s factual, killing the first born son was an action of King David. Only a few European countries are sensitive to Jewish jokes, in most it’s perfectly acceptable. Remember the majority of European countries are anti Israel and their current actions.

Yacine
Yacine
5 years ago
Reply to  MIMH

Come on! Anti-Jewsih jokes are acceptable in most European countries? May be in Eastern European ones but definitely not in Farnce, Belgium, the UK or Germany, to name a few.

Simon
Simon
5 years ago
Reply to  Yacine

Unless told by Jews, of course.

Simon
Simon
5 years ago
Reply to  MIMH

But how funny!

ShabinaKhatri
ShabinaKhatri
5 years ago
Reply to  MIMH

Deleting for stereotyping.

MIMH
MIMH
5 years ago
Reply to  ShabinaKhatri

But it’s not stereotyping! I’m guessing by your headscarf you are religious and therefore Muslim. So you are telling me you do not know the stories of Abraham and King David? These are people of the book and Jewish.

ShabinaKhatri
ShabinaKhatri
5 years ago
Reply to  MIMH

You can justify all you want, it’s still stereotyping.

Yacine
Yacine
5 years ago
Reply to  MIMH

Even Barwa which is a state entity? Their apartments at Barwa City are now offered at 30% increase of last year’s rate!

MIMH
MIMH
5 years ago
Reply to  Yacine

Who owns barwa and are major landlords in Qatar?

econ
econ
5 years ago
Reply to  MIMH

Half by Gov. (Diar) other half by Qatari and foreign shareholders who trade shares on QE.

Yacine
Yacine
5 years ago
Reply to  econ

Are you sure Barwa is on the QE? It’s been “bailed out” many times by the government. It is actually a badly-managed company and I am surprised there are people who invest in it.

Elkhorn
Elkhorn
5 years ago
Reply to  Yacine

It actually is in the QE (its priced at 53.8 as of yesterday) and it presently holds a large cash hoard – based on its sale of several properties (including Barwa Bank) to Diar and other Qatar institutions…

Andrew
Andrew
5 years ago
Reply to  Elkhorn

It’s also a volatile stock. About 12 months ago it was priced at 34.55 Qar, it climbed up to 54.2 in mid November before plunging back down to the mid 30s in the December 2014 ‘correction’. It’s since made steady gains to return back to the 50s. In other words, it’s made no gains in the past 12 months, only recovery.

Elkhorn
Elkhorn
5 years ago
Reply to  Andrew

I have to respond before Shabina deletes this. The reason it plunged to the mid 30s in November / December 2014 was based on the same plunging of the oil price (brent) from 110 to the 50s. The so called correction did not only affect Barwa (BRES) but all stocks in the QE.

Andrew
Andrew
5 years ago
Reply to  Elkhorn

The plunges I understand. It’s the peaks that make no sense to me. Check out the 3 year chart for Ezdan and help me understand what explains the peak back in 2014?

http://www.marketwatch.com/investing/stock/eres?countrycode=qa

Elkhorn
Elkhorn
5 years ago
Reply to  Andrew

For Ezdan, there’s only one word that I can use for everyone to understand…. its “Greed”…

If you look at the fundamentals, Ezdan is weak. its EPS is low compared to others such as Mazaya, United Development and even Aamal Holdings… but people love to profit and that’s what’s also happening in Ezdan right now….

MIMH
MIMH
5 years ago
Reply to  econ

and there is your answer, the same people in the government who are responsible for Barwa are also major landlords as individuals. They are in a perfect spot to rig the market….

Matty
Matty
5 years ago

Personal experience:

– rent has not increased this year for me and when considering moving to something bigger, the same apartment that views last year is now cheaper. One can argue that it is in The Pearl and that the rent is high but still. Not always been like that.

– had my car listed now for a few months, had two serious talks out of two calls ( not bad considering!) but both potential buyers vanished out of thin air when thing got concrete (both had a drive tests and took it to the Germn shops).

Paul
Paul
5 years ago
Reply to  Matty

You must drive a german car.. 😉

Nas
Nas
5 years ago

The good thing is that the market will regulate itself, I am talking about cars and real estate here.

Yacine
Yacine
5 years ago

For new expats in Qatar, even with these seemingly good deals on second-hand cars, it would be better to go for a long-term lease (or lease-to-own) plan. VW, Honda, Mercedes, BMW and many other dealerships have now very attractive offers with 0 percent downpayment and excellent monthly rates. Better check these out before you take a loan and buy a new car.

Doc
Doc
5 years ago
Reply to  Yacine

Why is that a better option than owning a car? Most of those leases require a large final payment. Its better than renting for sure but you still have a finance agreement with a bank for a lease

Yacine
Yacine
5 years ago
Reply to  Doc

I have been checking them for a while and eventually chose the lease because I discovered they are better both in the short and long term. I am talking about the new offers not the old one. In the new offers you can get, for example, a Honda Accord 2015 for 1200 per month on a yearly lease (full insurance, zero down payment, deal with the dealership directly not through a bank, etc). There is no way whatsoever owning a Honda Accord 2015 will be cheaper than this lease plan, unless you own it for 10 years and then sell it, but even with that I am not sure it would be better than the lease. Just make the calculations and you will see 🙂

Doc
Doc
5 years ago
Reply to  Yacine

And if you lose your job what happens to the lease? You can walk away?

Yacine
Yacine
5 years ago
Reply to  Doc

Yes of course. You return the car and that’s it. And that’s why it is a great option for expats.

iqxgo
iqxgo
5 years ago
Reply to  Yacine

You can’t just return the car and call it quits on the lease. A lease is a binding contract. You will be responsible for the remaining monthly payments unless you can find another party willing to assume the lease.

Otherwise, it’s called renting.

Yacine
Yacine
5 years ago
Reply to  iqxgo

Nope. When you are terminated and you are going home you speak to them to cancel the contract. This is what is called a force majeure. They will not ask you to pay the rest of the cheques before you go, but you will obviously have to find a settlement with them as they have also the security deposit (cheque) from you.

Doc
Doc
5 years ago
Reply to  Yacine

So you cannot just walk away then?? you have to settle as you would if you had a car loan or personal loan………..

Michael Fryer
Michael Fryer
5 years ago
Reply to  Doc

And if the dealer takes your security deposit cheque to the bank and it bounces, you will be held here on a travel ban.

Doc
Doc
5 years ago
Reply to  Michael Fryer

What happened to the 20% downpayment that was required to stop all this happening (i.e. negative equity and people unable to pay)? Has it been forgotten about?

Yacine
Yacine
5 years ago
Reply to  Michael Fryer

That is not how it works. There are conditions to return the car. If you stop the lease before its due date and return the car scratched or accidented then it is the dealership’s right to take its money from the security deposit. If you stop the lease and return the car in a good shape and below the maximum allowed mileage then there is no reason why they would take your deposit.

Anthony.
Anthony.
5 years ago

Am neither a buyer nor a seller. There are soo many buyers willing to buy car and ship home just like it’s been done in Europe and America but the price of cars here compared to Europe or even UAE is better than buying here . So if the prices where like in the Europe I think there won’t be flooding . Cos people are willing to but but for the price

Yacine
Yacine
5 years ago
Reply to  Anthony.

I think prices in Qatar are much cheaper than Europe. You can quickly check it online and you will see the big difference. The specs are different though and cars made for the GCC are not very suitable for Europe.

Doc
Doc
5 years ago
Reply to  Yacine

Europe prices are far cheaper as they are in the US else people wouldn’t import here as they do. Secondly you do realise 9/10 cars there is absolutely no difference in spec between north american and european cars to what we have here?? Whoever tells you different (usually a dealer) is completely wrong.

Yacine
Yacine
5 years ago
Reply to  Doc

The paint, the tires and few other things here are not similar to what you find in Europe. They are supposed to withstand extreme heat. The engine is also different as here there is little interest in low-emission or hybrid engines. I drive a car with an engine that has been discontinued a while ago in Europe and the US but is only used here, because of its high fuel consumption and carbon emissions.

Doc
Doc
5 years ago
Reply to  Yacine

You are right on those points, the european & US cars are better than what are sent here – and hybrid with batteries is utterly useless when fuel is so cheap and the climate destroys batteries!

Yacine
Yacine
5 years ago
Reply to  Doc

And also talking about prices, just to give you an example, this car starts from 21k USD in the US, that is 77k QAR. The same model here starts at 69k QAR, that is nearly 10k difference. The GCC is the cheapest part of the world for car acquisition.
http://www.vw.com/models/passat/

Doc
Doc
5 years ago
Reply to  Yacine

Pick ups, Muscle cars and many top end cars are far cheaper in the US. Hence why so many are imported here.

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