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Dubai’s properties need people

Dubai’s properties need people

The emirate’s real estate sector can only pick up if Dubai’s population grows, says a new study. Transparency and better customer service are also essentials.

January 11, 2010 12:35 by



Dubai’s real estate market is facing a massive oversupply, and will need a quick growth in the emirate’s population in order to recover, according to the latest report released by property broker Harbor Real Estate.

“In 2010, oversupply will be an issue in the market. An estimated 60,000 residential units and 30 million square foot of office space are coming on stream by the end of 2011,” the report said, adding that Dubai Marina and Jumeirah Lakes Towers alone were expected to see around 10,200 new units in the next two years.

Dubai’s population declined between 5 percent and 8 percent in 2009; the city will need to see a growth in its population to increase property demand and “kick start the industry again,” the report said.

It’s also not going to be easy to attract existing investors. Demand last year was dampened by the lack of available credit and the tightening of lending rules by mortgage lenders.  In 2010, investors are expected to be extremely cautious, the report said.

“Gone are the days of the easy sale to the investor. Simply put, many people have been hurt by the real estate price correction. In effect, they have developed a risk aversion, which will take some time to overcome,” it said.

One of the key things essential to increase the confidence of consumers in the market is to increase transparency, the report said. Currently, laws and regulations about disclosure are limited.

“Investors, especially those from overseas, need to feel that their rights will be protected and, in case a dispute arises, resolution will be equitable, accessible and timely,” the report said.



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5 Comments

  1. Miss Anne Thropic on January 11, 2010 1:03 pm

    Well, this pretty much knocks on the head the ridiculous “Burj ripple effect” comments people made when the Burj Khalifa opened, claiming it would somehow create a ripple of property investment all over Dubai. Er, yes, because that’s sound economic theory…

     
  2. Anupama V. Chand on January 12, 2010 7:04 am

    The writing is on the wall, and has been for over a year now, for anyone who has cared to see it….building a city of dreams, purely upon great infrastructure and facades was never going to work. You need to show investors something that has ROI value, and this is sadly not the case in Dubai today. Before sinking more money into building real estate marvels, that are certain to be non-starters, Dubai needs to regroup, and take a serious rethink of how it wishes to promote itself, and what are the services / products it is going to offer potential investors. As far as increasing populations go, now that they’ve successfully packed off the Indians, Pakistanis and Bangladeshis in droves, perhaps it is the turn of the Chineses and Russians to stage a re-entry and carry forward the dream-building (pun intended!) exercise….until they get thrown out too…..this is the trickle down effect of greed in high places and vaulting ambition on the part of the privileged few decision makers, who’ve made a killing when the economy was thriving….let’s hope the good days come back, but I strongly suspect its water under the bridge now.

     
  3. AR on January 15, 2010 5:21 pm

    Sheikh Mohammed could give free 3 year residence visas for homeowners and families to kickstart this ….

     
  4. SMK on January 20, 2010 8:08 am

    RERA has its priorities wrong regulating real estate agents first. The real issues for owners & investors alike are:
    1. Lack of clear ownership rights
    2. Owners kept under control of developers post handover and being charged high and unsubstantiated service charges in return for poor service
    3. Lack of ability to collect service charges from delinquient owners
    4. double payments (DEWA municipality charges & building & master community charges) for the same service (e.g. trash collection)

    Instead of color coding the real estate agents how about the Association Law gets implemented

     
  5. huma on January 21, 2010 4:51 pm

    Lets all stop Dubai bashing ..it think it has its issues but it has alot of things to offer…we must accept the current market conditions..the whole world has been gravely affected by this global crisis ..Complaining is easy ..what we need to do is create hope and better sentiment..

     

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