Is UAE property development getting out of hand?
The UAE is making some big plans related to real estate investments and developments over the next five years, with hundreds of thousands of new units to enter the market.
It seems that the property market is buoyed by the fact that Expo 2020 is just around the corner; and Dubai has shown itself resilient and not perturbed by any geo-political or economic conflicts around it.
Surely market intelligence has been the key driver behind those future ambitious plans. But did you know that there is a smarter way to bid, buy, sell, lease and rent?
eMart and eAuction
The Smart Property Marketplace, eMart, is one of many innovative solutions that Dubai Land Department (DLD) has designed to facilitate real estate transactions.
The mechanism of the platform is simple but highly effective, providing owners, investors, developers and real estate agents with the opportunity to list their properties through eAuction.
As eAuction is used by international investors who seek to gain a foothold in Dubai, the system eases the sales process and improves the potential for the seller to secure the highest possible price.
The platform allows those wishing to buy, sell or lease real estate properties to undertake transactions securely, transparently and with official guarantees.
The system also provides a convenient electronic payment service through ‘Noqodi’, the e-payment gateway.
This project is part of a wide range of initiatives launched by DLD to support the “Dubai Plan 2021” and the Emirate’s preparations for Expo 2020, expected to attract more than 20 million visitors.
Look who’s buying, how and where
According to Allsopp & Allsopp, a real estate firm, most of its Dubai tenants fall into the so-called “Generation X,” i.e. those born between 1960 and 1983.
In the period between August 2017 and October 2017, the agency discovered more than half of those tenants – 56 per cent – were between 31 and 45 years old.
Lewis Allsopp, CEO, says: “There will be high proportion of the 56% that will be families moving in to family homes and from the trends that we have seen over the last couple of years, we would expect a high proportion again to purchase over the coming years. Dubai is a city where more and more people are looking to settle and bring up their children.”
Cheque payments still dominate the rental market, with approximately 65 per cent of Allsopp & Allsopp’s tenants paying their annual rent in two or more cheques.
Also, Indians are becoming more aggressive in their investments in Dubai real estate.
“Overall, Indians have invested AED 126 billion so far in all these years into Dubai realty. Indians are looking at profitable dividends in the form of rents, resale value and other benefits. Investors want to secure assets ahead of the Expo 2020 boom”, said Mr. Majid Saqer Al Marri, Senior Director, Real Estate Investment Management and Promotion Center, DLD.
Build them and they will
Property development in Dubai is scheduled to deliver another 387 real estate projects, offering 163,840 new units over the next five years, according to analysis by fäm Properties.
A total of 24 residential and commercial developments are scheduled to deliver 7,336 units for handover before the end of this year, followed by 63 (27,360 units) in 2018, 36 (19,850 units) in 2019, 12 (17,754 units) in 2020 and one (114 units) in 2021.
Another 251 projects (91, 430 units) are either currently short of 100 per cent completion or pending final inspection, with the developers having a 12-month grace period to deliver.
“So far in 2017, Dubai has seen the launch of 90 new projects consisting of 36,556 units,” said the report.
“We want our investors and buyers to have a more accurate picture of the Dubai property market […]. This is something they’re eager for because it will help to make buying decisions based on facts and figures and is ultimately more profitable by being able to analyse facts and figures in a new way,” said Firas Al Msaddi, CEO of fäm Properties.