Kuwait Turns to Private Sector as Housing Requests Surge

Kuwait City, September 25, 2025: Facing a deepening housing crisis decades in the making, Kuwait is calling on the private sector to take a leading role in the delivery of new homes, as government-run programs struggle to keep pace with soaring demand.

Housing Minister Abdullatif Al-Mishari announced the shift in strategy during a landmark conference attended by hundreds of representatives from private real estate companies and local and foreign banks, signaling a fundamental change in how Kuwait addresses its housing needs.

A Growing Housing Backlog

Under Kuwait’s constitution, the oil-rich nation is obligated to assist all Kuwaiti families in securing housing. For decades, the state has been the primary provider through its Public Authority for Housing Welfare. However, demand has far outpaced supply, leaving many families waiting for years and in some cases decades to obtain accommodation.

Figures released by the housing authority illustrate the scale of the challenge.

• 105,000 current housing requests are on the waiting list.
• Requests are growing by 3% annually.
• By 2035, demand is projected to reach 197,000 housing requests.

This backlog has prompted the government to seek new solutions, with private sector participation now seen as essential.

“The private sector today is a true partner in solving this problem, and the reliance now is on you,” said Minister Al-Mishari. “Now I will be the regulator, I will follow up with you, follow up on the projects and the quality, but the core of the matter is with you.”

Restructuring Kuwait’s Housing Approach

The government is currently restructuring the Public Authority for Housing Welfare, transforming it from an executive body that builds homes to a regulatory authority that oversees private sector projects.

Al-Mishari emphasized that while the government will maintain oversight on quality and progress, the design, financing, construction, and delivery of housing units will primarily rest with private developers.

This shift represents a historic change in Kuwait’s housing policy, moving away from decades of direct government management toward a public-private partnership model.

New Housing Projects and Opportunities

As part of the initiative, Kuwait last week opened pre-qualification for foreign and local private companies to participate in three major housing projects spanning four key areas.

The projects cover 4.15 million square meters (44.6 million square feet) and fall under a real estate development law approved in 2023 and enacted earlier this month.

The contracts will span 30 years, divided into two phases:

• Four years for design and construction of the housing units.
• Twenty-six years for investment, operations, and management.

Under the terms, housing units will be sold directly to Kuwaiti citizens, while non-residential assets such as retail or community facilities will eventually be transferred back to the government.

Although no specific project value has been disclosed, the scale is expected to be significant given Kuwait’s rising population and demand for housing.

Mortgage Law in the Works

To support private sector participation, Kuwait is drafting a new mortgage law that will allow banks and finance companies to provide housing loans to citizens.

Minister Al-Mishari confirmed that the legislation is in its final stages and should be ready within weeks, creating a much-needed financing mechanism for homebuyers and developers.

Major New Cities Under Development

Alongside the private sector push, Kuwait is moving ahead with several large-scale city developments aimed at delivering long-term housing solutions.

The government is currently planning and developing three new cities:

• Al-Khairan
• Nawaf Al-Ahmad
• Al-Sabriya

Collectively, these projects will cover 355 square kilometers and include approximately 185,000 housing units, representing one of the largest residential development programs in the country’s history.

“This is a launch, not the goal. The goal is to solve the housing problem,” Al-Meshari said, underscoring that these initiatives are the first step toward resolving decades of accumulated housing challenges.

With a population of over 1.5 million citizens, Kuwait’s housing demand will continue to rise as the country grows economically and demographically.

The success of this new model will depend on the private sector’s ability to deliver large-scale, high-quality housing projects efficiently, while the government focuses on regulation, oversight, and financing frameworks.

If implemented effectively, this strategy could reduce waiting times for housing, stimulate economic growth, and create new investment opportunities for both local and international stakeholders.

Kuwait’s pivot to a public-private housing strategy represents a turning point in the nation’s urban development, with the potential to reshape how homes are built, financed, and delivered for generations to come.