by bill barber
Speculations about Dubai real estate market!
Article by William King
Last many years have witnessed the developments done in Dubai real estate, which brought many positive changes specifically in the property dealing pattern and generally in economic turnover of the region. It has been widely accepted that the best of these moves taken by the concerned real estate authorities has been allowing foreigners to invest in Dubai properties as well as enjoy ownership rights. After the enactment of this law, Dubai became the hottest investment spot around the globe and witnessed a boom in its real estate sector. However, the financial crisis of 2008 badly shook the stature of property business in Dubai. Although, the dust of real estate crises has not settled yet but the sector is getting stabilize.
Numerous projects are to be delivered in near future so the investment opportunities are once again widening for the stakeholders of Dubai real estate. Although, Dubai appeared to be a distress property market, as various properties were available at quite low rates, which highly favoured the investors and motivated them to make more investments in Dubai real estate, yet these predictions failed to materialize. Many companies and individual investors are interested in buying properties in Dubai therefore it is important to consider the experts’ speculations about its real estate sector, which are as follows.
Irrational exuberance is over!
Buyers are no longer that heedlessly excited for buying property in Dubai they have rather become rational and sane in choosing right properties according to their investment plans. They prefer dealing with the developers who possess a diversified portfolio backed by squeaky clean repute in the region. If the developers want buyers to invest in their developments, they need to maintain a high profile in related dealings.
Off-plan properties are no more in demand!
Off-plan properties, which were once considered the best mode of investment, are no longer in demand. Considering the current situation of real estate market of Dubai, buyers do not want to take risk by investing in off-plan projects that can be halted or cancelled in later stages. People prefer investing in properties that are already built and ready to be handed over. Therefore, for the next few years, the developers are advised to reduce the size of their off-plan properties’ inventory.
Financial institutions are back in action!
Before real estate crisis hit the UAE, banks and financial institutions stopped providing loans or mortgages for properties and lack of loans and cash money made it tough for potential buyers to buy properties in Dubai. However, liquidity ratio has been good in Dubai throughout the crises; banks and financial institutions are offering good profit rates. Investing in Dubai rental properties is ideal in this condition as the rental return in Dubai and many other UAE states is noticeably high.
Location is everything!
You must have heard that there are certain areas in Dubai where the recession did not affect the property rates and the rentals. The demand of high-end properties in Palm Jumeirah, Jumeirah Lake Towers, Downtown Dubai, and areas surrounding Burj Khalifa hardly went down due to their prime location. Established developments in these regions are the attractive options and provoke investors to buy properties there. Though prices are relatively lower than the peak period’s rates but these areas have not lost their charm and are still high in demand. Other areas like The Lakes and The Greens recovered soon from the property crises and they have now become one of the most desirable areas of the city. Right now is a good time for popular developments and reputed developers to cash their presence because the future of Dubai real estate is marked with mature and stable market where choices for buyers and investors would be endless and consequently the business opportunities for developers are likely to shrink.