Dubai in it for the long run. Weekly Dubai real estate news digest. Issue 90

22.03.2015
Dubai in it for the long run 
Welcome to the ninetieth issue of Market Insight, your weekly guide to what's happening in the Dubai real estate market.
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MARKET INSIGHT. Weekly guide to Dubai's property scene
Issue 90 |  March 22, 2015

Dubai in it for the long run 


Growth in Dubai's property market may be slowing down, but the future of the real estate market lies in sustainable development, something that UAE-based developers are now paying attention to.

The market is set to gain momentum in 2016 with affordable housing options paving the way, according to the chief of Dubai Investments. Company CEO Khalid bin Kalban said that he doesn't expect to see a price correction in the market. 

However, 2016 is expected to see a hike in affordable housing projects since market forces are driving developers to leave luxury behind and focus on the needs of end users. These homes are meant to cater to those earning between AED10,000 and AED25,000.

The Emirates has also turned its attention onto sustainable practices when it comes to the building of new residential towers. The Dubai Electricity and Water Authority (DEWA) has launched the first of its new series of smart initiatives, Shams Dubai. As part of this project, residents across the home will be encouraged to install photovoltaic panels to generate electricity from solar power in buildings and connect them to DEWA's grid.

Meanwhile, investors are also taking a step back. "The drop in buying activity is substantial within the high-end space by more than 60%," says Sameer Lakhani, managing director, Global Capital Partners. "Clearly, investors are taking a breather when it comes to committing funds to property. They are the ones who expect a quick upside to their entry prices and find that's not going to happen now."


Market Insight is aimed at examining the emirate's dynamic market and forecasting industry trends. The real estate market in the UAE has not only been growing exponentially, but it has also been developing into one that is more sustainable. It's more than apparent that developers in the region are now thinking about the big picture and focusing on long-term growth.

 
Sincerely,

Pashma Manglani

Editor


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Residents can now tap into solar power

The Dubai Electricity and Water Authority (Dewa) has launched the start of its first smart initiative, Shams Dubai, (Shams is Arabic for “sun”) to regulate the generation of solar energy for houses and buildings across Dubai.

“Shams Dubai supports the Green Economy for Sustainable Development economic initiative launched by His Highness Shaikh Mohammad Bin Rashid Al Maktoum," said Saeed Al Tayer, managing director and CEO of Dewa. "It implements Council Resolution Number 46 of 2014, issued by Shaikh Hamdan Bin Mohammad Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, to enable customers to install photovoltaic panels to generate electricity from solar power in buildings, and connect them to Dewa’s grid."

 

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More off-plan units on sale 

There has been a sharp increase in the number of off-plan properties being put up for sale in Dubai’s secondary market, Gulf News reported.

Owners of these units apparently believe trying to sell now will better protect their exposure rather than holding on to them. In the last four weeks, the incidence of such activity has shot up by 20%, according to market sources.

On most of these off-plan secondary market listings, the investors had paid 30-40% of the property’s value, as per the strict requirements Dubai’s leading developers had in place to curb speculation.

“It’s the high-end off-plan properties — priced at AED1,500 per square foot and over — that are figuring most prominently in the recent secondary listings,” said Sameer Lakhani, managing director at Global Capital Partners (GAC).

 

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Apartments now AED400k cheaper

Prices of apartments in Dubai now cost more than 20% less than in 2008, according to a Gulf News report.

One-bedroom apartments could be nearly AED400,000 less, analysts say. Along with rents, sale prices for apartments, villas and offices in Dubai either increased or declined marginally, depending on their locations, between 2013 and 2014, but since 2008, overall prices have actually posted a significant decline.

 

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By 2016, market will have affordable homes

The UAE property market will see more "affordable" houses by 2016, according to the chief of Dubai Investments (DI), one of the largest land bank holders in the UAE.

“I don’t expect a correction in the market. I expect a slowdown for 2015 because of outside factors and not internal factors," company CEO Khalid bin Kalban told Emirates 24/7.

“I think 2016 onwards there will definitely be a pick-up on affordable housing because of the projects being undertaken by the government such as Al Maktoum International Airport, Expo 2020 venue development and theme parks in Jebel Ali area."

 

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Indian expats prefer investing in flats: Study

The majority of Indians living in Dubai are planning to buy an apartment rather than a villa or townhouse, reveals a new survey.

Bayut.com found that nearly 61% of Indians surveyed were searching to buy a house in the past three months, out of which 83% were looking for an apartment.

Among the sought-after localities are Dubai Marina, Downtown Dubai and Jumeirah Lake Towers (JLT), Emirates 24/7 reported. Only 13.71% of Indians showed an interest in buying villas, while for townhouses the search was limited to 1.71%.


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