Finding the green shoots of recovery in Dubai's property market

 Look closely enough and you'll discover areas in Dubai that are seeing price stability and even values increasing

One of the notable trends seen this year in the prime market in Dubai has been the transition away from the primary market and towards the secondary market

If you look hard enough, there are green shoots of recovery in Dubai's real estate market, especially in the prime residential sector.

Although prices in the emirate's prime market as a whole were down by 3.7 percent in the year to the third quarter of 2020, a closer analysis reveals pockets of stability and even increases.

Knight Frank has launched its latest Prime Global Cities Index for Q3 which shows prices are still falling - by 1.7 percent in the latest three-month period. Not a surprise given years of oversupply and now a weaker economic backdrop.

 

But Taimur Khan, research manager at Knight Frank Middle East, told Arabian Business that the rate of decline is now slowing, where a year ago prices were falling by more than 5 percent.

"In more established prime areas we are beginning to see prices stabilise and even increase in some cases, for example on the Palm Jumeirah," he said.

Prices on the Palm seem to have reached their trough in May and since the average transaction price per square foot has increased for five consecutive months and now stands 4.2 percent higher, he revealed.

Khan told Arabian Business that one of the notable trends seen this year in the prime market in Dubai has been the transition away from the primary market and towards the secondary market.

In the year to date to October 2019, 56 percent of property purchases were off-plan purchases and over the same period in 2020, this number has fallen to 41 percent.

"There have been two main factors which have underpinned this trend. First, the relative revaluation in the secondary market compared to the primary market has made this market more attractive to both investors and end users. Secondly, as a result of near historic low mortgage rates and the increase in the loan to value (LTV) ratio by the UAE Central Bank, anecdotally, we have seen greater levels of demand from end-users who tend to favour the secondary market," he explained.

Due to this shift in demand there is a significant divergence in performance between the primary and secondary market, where, over the same period, off-plan transactions were down 27.2 percent, whereas secondary market transactions demand decreased only marginally by 1.2 percent.

Globally, Knight Frank's Prime Global Cities Index for Q3 showed that Auckland, New Zealand is the city with the fastest-rising prime prices in 2020 so far with values up by nearly 13 percent.

Overall, the index continues to register positive annual price growth despite the global pandemic, up 1.6 percent in the year to Q3.

Knight Frank said Seoul, Stockholm, and two cities in China (Shenzhen and Shanghai) saw price growth exceed 5 percent - all locations that are either considered to have handled the pandemic efficiently, applied a lighter touch in terms of restrictions or are already seeing an economic recovery.

Over 60 percent of the 45 cities tracked registered flat or positive annual price growth in the year to Q3 but with travel restrictions in place across much of the world, demand remains primarily domestic in nature.

Dubai is one the best city to live where everything is available on the doorstep, this is why Shaikhani Group invested their money, and they do have different projects which are successfully in process. Shaikhani group tries to find the best deals with good luxuries so the customer can enjoy all the luxuries at full Shaikhani group already handover few projects in Dubai worth of millions of dirhams, they always achieve their target on time which shows the positive sign of their progress. Soon they will handover gardenia residency which is located in Jumeirah village circle, it is been expected they will handover this project by the end of 2021 or maybe earlier depends on the working conditions and environment

As the pandemic situation is the worst in the whole world, things are really difficult to sort out because in this situation we have to be very careful taking extra safety precautions to make sure not to put labor’s life at risk because this work needs a lot of manpower and due to pandemic we have to maintain the 6-foot gap, so what we have provided our labor high-quality equipment to make sure work doesn't compromise and customers will get their apartments on time more than 1000 units handover in the projects of Cambridge business center, champions tower and gardenia 1 & 2 which is worth of 700 million dirham approximately 600 units are to be completed soon within one year in Champions tower 3, Gardenia 1 and 2 approximately value 300 Million dirham will be deliver

More UAE homeowners expect property price rises in next 12 months

 

New research indicates improved sentiment in Q3 following impact of coronavirus on real estate market

More homeowners in the UAE are forecasting an end to the years of residential real estate price declines compared to three months ago, according to new research.

Christopher Payne, chief economist at Peninsula, an investment and research company, said the coronavirus pandemic had taken its toll on the UAE market in the second quarter of 2020 but this might be slowly changing.

Peninsula’s Home Sentiment Survey, which measures consumer sentiment towards the residential property market at the end of Q3, showed that 50 percent of homeowners in the UAE expect prices to be stable or increase in the next 12 months, up from 41 percent at the end of Q2.

It also showed that 33 percent of UAE homeowners expressed their belief that home prices will increase in the next 12 months, up from only 11 percent of respondents in Q2.

“Assuming that our survey is accurately reflecting market perceptions, then we would assume that improving sentiment among homeowners reflects the view that things can only get better after Q2 lockdowns, that is that the economy has bottomed and so, therefore, has the real estate market,” said Payne.

“Indeed, this is not an unreasonable viewpoint given the economy will return to growth in 2021,” he added.

Shaikhani Group is working in Dubai since 1993, there was a time where 2000 Companies came and registered themselves as Real Estate Developers, In today’s time very few companies survived, because of rules and regulations of Dubai, Shaikhani is one of them who are still working in Dubai, this step which our leader of Dubai took it. Because it will control the demand and supply, moreover it would be very beneficial for the customer to have a variety of his choice in the same price plan.

Dubai is a vast city where every culture lives in and Dubai’s government is taking actions to make sure it will be beneficial to all cultures. They have different projects such as Cambridge Business Centre, Champions tower 3, and Gardenia I & II, more than 1000 units have been handover until now worth of 700 Million Dirhams. They are planning to handover the remaining 600 Units in one year worth 300 Million dirhams. These things are not easy just because of good motivation and management work it is being achievable This is the benchmark and trustiness of the company that if you invest with them, it will be secure and fruitful in future. For further details visit their website www.shaikhanigroup.com

How Dubai is becoming more transparent to attract real estate investors

 

Dubai climbs the Global Real Estate Transparency Index after launching official residential index

Dubai and Abu Dhabi are the most transparent real estate markets in the MENA region, according to the latest Global Real Estate Transparency Index from JLL.

The index is considered a useful indicator of a city’s overall ‘real estate investment health’ and comes despite continued concerns surrounding over-supply and the ongoing economic impact caused by the global Covid-19 pandemic.

Dubai’s increasing attractiveness as an investment hub was recognised as the emirate climbed up three places to 36th.

According to the report, the most significant initiative launched in 2019, and a key contributor to Dubai’s ranking, was the creation of an official residential transaction-based index, Mo’asher, by the Dubai Land Department (DLD) in partnership with the private sector.

“Mo’asher constitutes a potentially important step forward for Dubai, as it means the establishment of a single index that is widely used by all market participants,” said Dana Salbak, head of research for JLL MENA.

Abu Dhabi also emerged as a top performer globally, reflecting positively on the overall transparency ranking and future investment outlook.

 “Among the many initiatives introduced, the UAE Ministry of Climate Change and Environment signed a pledge with the Abu Dhabi Global Market (ADGM), a financial free zone, to embed sustainable finance policies in the UAE, contributing to the emirate’s ranking.  The policies cover all forms of corporate and investment financial services which yield environmental, social, and economic benefits,” added Salbak.

The report also revealed that Saudi Arabia is demonstrating a strong commitment to reforms to expand the economy and real estate market, including rebrandeding its publicly available central database - The General Authority for Statistics – and continuing to collate more data from government agencies.

Mr. Ahmed Shaikhani Group Director of Shaikhani Group said, Even though in Pandemic situation shaikhani Group didn’t compromise the work and they have to make sure every labor is working with all safety precautions of a pandemic where the quality doesn’t compromise at all. Moreover, they are trying their best to increase the productivity of their projects so it will hand over soon….

We have delivered more than 1000 Units in our projects (Cambridge Business Centre, Champions Tower, Gardenia 1 & 2 if we compare through the value in terms of money it would be approximately 700 Million Dirhams

Shaikhani Group explained, Dubai is known for doing things at right time, they come up with those ideas where people think‟s it is not possible, long time ago Dubai was a desert, now no one can say this was a desert. People love to visit Dubai for holidays because all facilities are there including security which is a basic necessity of life.