Attractive payment plans in UAE drive up first-time home buyers
dubai — There is expected to be a spike in scheduled residential supply entering the UAE market ahead of Expo 2020, benefitting from the enhanced infrastructure, especially around the Metro expansion, estimates CBRE Menat.
The consultancy expects 2019 to be a year of great opportunities for the UAE’s real estate sector. There will be a softening of year-onyear transaction volumes across both apartments and villas in 2019. However, developers will continue to offer highly attractive payment plans and incentives, potentially leading to a rise in the number of first-time buyers or owner occupiers, CBRE has forecast.
The top five locations for future supply include Dubailand, Mohammed bin Rashid City, Dubai Creek Harbor, Jumeirah Village Circle/ Triangle and Dubai South. Attractive ticket prices will continue to be a key strategy for developers as they aim to increase absorption rates, the CBRE adds.
Meanwhile, experts at JLL cite the increasing opportunities in the areas of flexible office space, sale and leaseback, real estate investment trusts (Reits) and alternative real estate assets, including warehouses and the logistics industry.
“Conditions softened across most sectors of the UAE real estate market in 2018. The prospects for 2019 will to some extent depend upon how quickly the regulatory changes enacted last year begin to generate additional demand. While market conditions are likely to remain challenging, investors and occupiers have the opportunity to introduce new strategies to enhance their performance,” said Craig Plumb, head of research, JLL, Mena.
Technology will continue to be a key influence across all sectors of the UAE’s real estate market in 2019, as new solutions have the potential to drive smarter and more efficient means for predicting the market, purchasing transactions and managing assets, say experts at JLL.
The core factors shaping investment opportunities in Dubai’s real estate market in 2019 include the rapid rise of flexible office space in Dubai, with growth set to continue at a rapid pace in years ahead owing to strong demand from both tenants and landlords. The concept of flexible office spaces remain popular as occupiers focus on new ways of working and driving cost efficiencies.
In 2018, Dubai’s retail sector remained the most challenged because of an increase in oversupply and the rise of e-commerce. The future performance of the sector will depend upon the incorporation of innovative entertainment and food service concepts to drive footfall and spend.
There is also a simultaneous surge in demand for more specialist facilities, including warehouses. The year ahead will create more opportunities and facilities in free zones housing industrial distribution centres.
2018 also saw a surge in hotel sales in the UAE and this trend is expected to continue into 2019 as operators seek to move to a more ‘asset light’ model. Other features in 2019 are likely to include more rebranding announcements and a continued growth in supply in the midscale/upscale sector of the market.
The prospects for 2019 will depend on how quickly the regulatory changes enacted last year begin to generate additional demand
Craig Plumb, head of research, JLL, Mena