Mortgage plans: Built-to-order

DUBAI INVESTMENTS’ Khalid bin Kalban is a former chairman of Union Properties, and has mapped the Dubai real estate market better than most. The master builder issued a caveat on the overgenerous payment plans currently being offered by developers in Dubai.

“There are tremendous deals in the market today — such offers did not exist even prior to the market downturn in 2008. Developers are vying with each other to offer deals,” said Bin Kalban.

The senior executive noted that developers who exited the market in 2008 are making a comeback. “I am all for healthy speculation. But over-speculation is bad. Similarly, regulation is good, but overregulation is bad,” he added.

While acknowledging that real estate remains one of the most profitable sectors for Dubai Investments, Bin Kalban said competition is tough in Dubai’s real estate sector today.

“Most developers keep building and don’t look at the feasibility, leading to an oversupply situation. Some areas in Dubai are seeing an oversupply. Investors are always looking for the right bargain. They will postpone their purchase decision anticipating oversupply. However, it is the right time to invest in Dubai South now,” suggested Bin Kalban.

The former chairman of Union Properties also reiterated the need for developers to generate recurring revenue year on year. “Our rental portfolio is worth Dh1.2 billion. We develop not only to sell but also to retain. This strategy will sustain us during a crisis,” he observed.