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Keeping it real (estate)
From the drop in rental prices, to the emergence of new contractual trends, Kipp takes a look at recent developments in the property sector of the UAE
October 3, 2010 3:25 by Eva Fernandes
As major regional players in the property sector get set for Dubai’s annual real estate conference, Cityscape Global (formally Cityscape Dubai), Kipp takes a closer look at recent developments in the realm of residential markets in the UAE.
JLL report confirms Dubai Residential Market Oversupplied:
According to the latest report by leading real estate investment and advisory firm, Jones Lang LaSalle, although “demand has increased in most sectors of the market compared to that experienced in 2009, the timing of any recovery has been extended due to excess supply.” By the end of 2010, roughly 35,000 new residential units are expected to be completed across the Dubai market, followed by around 30,000 new units in 2011, bringing the total residential stock across Dubai to around 337,000, of which around 78 percent will comprise apartments and the remainder will be villas. Jones Lang LaSalle predicts that even if the current projects are “are not completed and handed over in time, Dubai’s residential market [will continue] to be oversupplied and prices are not expected to recover before the second half of 2011 at the earliest.”
Asteco charts Dubai’s rental price drop:
In their latest report, property management company Asteco said rental rates in Dubai have contracted by a further 6 percent and office leases declined by another 3 percent in the third quarter. Although it did note that properties in Jumeirah Lake Towers dropped just 2 percent with just a 3 percent alteration seen in Discovery Gardens. Villa rentals fared slightly better with average declines of 4 percent from the second quarter. The report noted that sale prices in a number of freehold communities across Dubai remained stable in the third quarter when compared to the previous three months.
Somber mood at this year’s annual Cityscape:
The annual Cityscape conference, the glorious predecessors of which were the very events at which ambitious projects like Jumeriah Gardens and The Nakheel Tower were announced, is predicted to be a lot more somber this time around. For one thing, some are considering the name change of the conference to Cityscape Global — a change from the Cityscape Dubai — to be symbolic of an attempt to reach for markets beyond the not-too-promising Dubai. What’s more, Cityscape has 38 fewer exhibitors than last year. But it will play host to all the regular local participants including Emaar Properties, Nakheel, and Dubai Properties Group. Meanwhile Mubadala Development, a strategic investment company owned by the Abu Dhabi Government, and Waha Land will be present and correct for Abu Dhabi.
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