Dubai Residential Property Market the Global Investment Hot Spot in year 2013

Monday, January 7, 2013

This must be an amazing fact that real estate market, which was known to be the worst performing property market in year 2009, started displaying good recovery in fourth quarter of year 2011. Since its recovery, Dubai has been grouped in golden investment opportunities in the region of MENA (Middle East and North Africa region). The huge volume of UK and Asian professionals making enquiries to relocate from other countries to the trade hub of UAE has revealed this fact that residential assets will be on high demand in coming year, whereas supply of high quality houses and villas will remain static. Villa prices showed significant rise of 20% during the first three quarters of 2012. Villa prices will continue to rise in year 2013 and expected to rise 10%. The main reason of this rise in Dubai villa prices is increased interest of Indian and Iranian expats in buying high class residential assets in the city.

 

Dubai Residential Property Market 2013

 

According to the latest report of Jones Lang LaSalle, the residential sector of Middle East will be the most preferred region to make investment. Investors show their interest in buying luxury residential properties as compared selling. On international levels, prime residential property prices will show average rise of 2.5% in year 2013. The report also mentioned that total residential transactions for year 2012 were sum up to Dh 10.3 billion, which is 49% higher than previous year’s transactions Dh 6.9 billion.

 

Another expert Ziad Al Chaar, who is working as Managing Director in DAMAC properties, predicted that the Emirate of Dubai offers potential opportunities for investors to earn profits in real estate sector. Earning profits mainly depend on the ability to choose suitable real estate project and property type to make investments. 2012 have already shown substantial growth in real estate sector in every quarter of the year according to the predictions made by asset professionals. Moreover, experts have made prediction that buyers can take advantage of this capital growth by choosing right project in specific areas.

 

A recent survey to find real estate investment trends for coming year, by Jones Lang LaSalle has uncovered this fact that 50% of respondents show strong interest to sell some of their assets while at the same time they are also showing interest in buying suitable properties in coming year. 34% respondent showed that they are only interested in buying assets in Mena region, whereas remaining 16% opted only to sell their properties. Experts have shown positive opinion about several asset markets in the region of MENA that include Saudi Arabia, Abu Dhabi, Qatar and Egypt. Dubai positioned on top among all regional markets of MENA in last 12 months. Local economical improvement of 4.5% GDP in past 12-18 months put great impact on investor’s approach and fosters Dubai’s image as an investment destination in year 2013.

 

Mentioned in a news report of gulfnews.com Dubai residential property market has been continuously showing progress as developers are delivering stock of freshly completed stock of residential developments. The fresh supply put positive effect on property prices and rents. But it has also observed that few popular freehold communities like Emirates Living, Arabian Ranches, Palm Jumeirah and Downtown, display significant rise in property rent and prices. According to Dubai Land Department’s statistics mentioned in a recent CBRE report (a global real estate consultancy firm) Dubai Marina and Jumeirah Lake Towers successfully made real estate deals of 2.74 billion worth that accounts for 84 % of the total volume for third quarter of 2012. Further research on investment trends also revealed that most of the investors prefer to make investments in complete projects to make profits in long terms rather than incomplete projects. Besides this, investors also choose assets with small lot sizes over assets spread over huge area. Furthermore, Emirate’s residential sector also showed good progress in 2012 by launching new residential developments like The Mohammed Bin Rashid City that support future image of emirates in 2030.

 

Such progressing trends and increased interest of real estate investors in buying residential properties, enlisted Dubai residential property market among best performing residential market on international level. Other asset markets, which are expected to perform best real estate markets, include Moscow and Miami.

Comments (1) -

Dubai LivingU.A.E.Dubai Living said:

Looking ahead to 2013, the market is likely to see 'a broader-based recovery, but the significant levels of current vacancy and further new supply will limit the extent to which poorer quality projects and those in secondary locations will benefit'.

The Dubai property market is showing good signs of recovery, with many neighbourhoods reporting the first increases in values since 2008.We've talked about selective stability in the past, and now we can be more positive and talk about selective recovery. Price and rent recovery are likely to be broader this year than 2012 when it was limited to few selected locations. We saw price growth in Dubai by 20 per cent in 2012... we will not see prices increasing 20 per cent this year, but overall rate of growth will be less than last year.”
Residential stock in close proximity to the Metro stations will see increase in prices and rents. the new regulation on housing allowances for government employees and a possible reverse migration to the capital due to rental growth in Dubai will have a positive impact on the market.

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