Saturday, June 4th, 2016

Stability finds its way in the Dubai Property market

Narada Desk | June 4, 2016 6:01 pm Print
Stability has been showing up in the Dubai Real Estate affairs. With such a study coming to knowledge, it promises to turn out fruitful in terms of investment, options and availability. Statistics from the first quarter have shown outdone results for properties varying from prominent properties from IPMZ to The Palm Jumeirah.

Stability is showing up on the two counts that matter most in Dubai’s real estate — on property values and in the number of monthly transactions taking place of ready properties. And these stats are just not confined to a handful of residential clusters at different spots only.

With the stability showing up, investors will now not only have an easy time dealing on the stable rates but also, the stability in the prices give a wider range of property investments which was only confined to a narrow scale before.

Only three apartment-based locations during the January-May period missed out on the month-on-month gains — Motor City (down 50 per cent over April), Sports City (by 21 per cent) and Remraam (a cluster in Dubailand that was down 62 per cent), according to data from Global Capital Partners, a consultancy. (Among villa-centric communities, Jumeirah Park and Jumeirah Islands saw deal-making lower in May by 60 per cent and 50 per cent, respectively.) But elsewhere, things were distinctly upbeat, with the emphasis on “price stability”. International City and Dubai Marina recorded the most deals in May, at 177 and 141 respectively.
The Palm Jumeirah for the first time in this year, pushed past the 50-deals a month mark for the first time to a total of 56 units.

With the month of Ramadan starting, the question of closing property deal before the month commences has also been brought into light.

“There will likely be a decline during Ramadan … however, we are seeing enhanced buying interest from end users suggesting this is not a seasonal buying effect,” said Sameer Lakhani, Managing Director of GCP. “Transactions are rising in all areas, implying different price points are compelling buying.”

According to Chesterton Mena’s latest market update, mortgage transactions shot up during Q1-16 and “increasing total transactions to a total of Dh27 billion. Indeed, banks report mortgage business booked well into the third quarter.”

The fairly decent transaction levels have taken many by surprise. “The second quarter of 2016 was expected to be quiet in terms of activity,” the Chesterton report adds. “However, there has been a marked increase.”

“There were bargains for properties in locations where the price decline had been the greatest … predominantly in high-income communities,” said Lakhani. “Where there was end-user buying throughout the city, it was brought about by an admixture of factors, key being that price stability was being seen.”

The first five months of the year saw off-plan launches of just over 2,500 units across a multitude of locations. These included those at super-prime destinations such as MBR (Mohammad Bin Rashid) City and Dubai Creek Harbour. And a fortnight ago, there was even the announcement of the first “water homes” in the city (at the Marasi Business Bay by Dubai Properties) and which could go on sale shortly.

According to market feedback, off-plan-related sales would be running at 40-50 per cent. In a market still in the grips of a slowdown, those levels are being seen as “good enough”. “New projects launched by Damac, Emaar (were) received well by investors,” said the Chesterton’s report.

Well, the statistics say everything. And according to the updates coming in, the stability in property is surely a fruitful factor for all which decreases the chances of an investment gone bad.
With the estimations coming in for the coming quarters of the month, the stability will be enabling a lot of real estate opportunities for both, the investors and sellers.