MARKET CONFIDENCE ON THE RISE AS CITYSCAPE DUBAI GETS UNDER WAY
Investor sentiment is being lifted as oil prices continue rising and the government offers investors incentives
More than 300 developers, architects and brokers put their projects on show at the Cityscape Global exhibition in Dubai this week, as real estate sentiment buoys on rising oil prices and heightened government efforts to attract investors to the UAE.
“Despite the downturn of the market in recent years, there’s a healthy amount of optimism among real estate professionals,” said Tom Rhodes, exhibition director at Cityscape Global. “We’ve seen a more positive sentiment from investors, and a new drive from government agencies is propelling the emirate’s brand of real estate into foreign markets.”
At last year’s exhibition in Dubai on-site sales topped Dh870 million and event organisers are hoping for another strong year. “Over the past week we’ve seen a flurry of new launches from many of the country’s top real estate developers, and a number of exhibitors are planning launches for the first day of the show,” Mr Rhodes told The National.
Two large-scale projects were unveiled yesterday, the day before the event, including Abu Dhabi-based Imkan’s Dh15 billion “Riviera of the Emirates” project, aimed at second-home and holidaymakrs in the UAE, and Union Properties’ Dh2.5bn Avenue District, a component of the developer’s Dubai Motor City master plan announced this time last year.
Other developers will be marketing schemes at Cityscape this week at Dubai World Trade Centre, including Abu Dhabi’s Aldar Properties – which will be marketing villas at its Dh10bn Alghadeer community, and on Saadiyat Island – and Dubai’s Nakheel, which will promote the Dragon Towers residential scheme, which launched for sale on Sunday,.
Falconcity of Wonders, a real estate subsidiary of Dubai family conglomerate Salem Ahmad Al Moosa Enterprises, will market villas at its Eastern Residences gated community.
Other exhibitors include Sharjah’s Arada Developments, Bloom Holdings, Dubai Holding (the emirate’s investment vehicle), Meydan, Meraas, Azizi Developments, and Tilal Properties.
Real estate commentators say the breadth of schemes on display reflects renewed industry optimism after recent sluggish years. Sales and rental prices plummeted followIng a threeyear oil price slump, however, increased government spending and an uptick in oil prices above $83 per barrel have lifted investor sentiment and prompted expectations that prices could start to rise from next year.
“There is reason for cautious optimism – people believe the market has reached the bottom of the cycle and we are potentially headed for a boom once again, not to the scale of [pre-financial crisis] 2006-07, but a market that will see gains in property values,” said Lewis Allsopp, chief executive of brokerage Allsopp & Allsopp.
However, residential prices continued to fall year-on-year in the third quarter of this year. Villa and apartment rents dropped by 2 to 3 per cent in Dubai and sales prices by 4 per cent, according to consultancy Asteco’s market update last week. In Abu Dhabi, residential sales rates dropped by 1 per cent and rentals by 3 per cent, the report showed.
Rising supply could pressure rents further at the start of next year, said Lynnette Abad, director of research and data at real estate portal Property Finder.
A total of 25,000 units are scheduled to be delivered in Dubai this year, with the majority located along Sheikh Mohammed bin Zayed road and Emirates Road – “an area where the government is investing heavily in infrastructure expansion in the run-up to Expo 2020,” Ms Abad said.
As at Cityscape in Abu Dhabi in April, developers this week are expected to lure buyers with appealing payment plans, favourable mortgage terms, price guarantees and exemptions on property registration fees. Customers who buy homes at Aldar’s Mamsha al Saadiyat scheme, for example, are promised a rebate of 5 per cent of the price on handover, registration fee waivers and a five-year exemption from service charges.
The Dubai Land Department is expected to launch the latest in its toolbox of digital inventions intended to ease the purchase process.
“Our smart solutions have helped consolidate Dubai’s position as a preferred investment destination that…protects investors’ rights,” said DLD director-general Sultan Butti Bin Mejren last week.
This year’s event will also feature the launch of Cityscape Business Hub, an invite-only area for developers to interact with high-level local and international institutional investors.
The breadth of schemes on display reflects renewed industry optimism after recent sluggish years