The United Arab Emirates is expecting positive economic growth and figures indicate that the residential real estate in Dubai is recovering with more foreign buyers coming back to the property market.
Land transactions in Dubai increased 21% to reach AED63 billion in the first half of 2012, figures from the emirate’s land department show. There were a total of 18,953 transactions to the end of June at an average of 133 per day and Sultan Butti bin Mejrin, director general of the Dubai Land Department, said the figures are an important indicator of the growth and strong performance of the market.
‘The real estate market in Dubai has shown high levels of flexibility in meeting investor requirements and trends during the first half, especially new investors looking to benefit from the price correction that emerged in the past two years,’ he explained.
He also pointed out that prices had increased in the past few months due to high demand for buying lands, villas and flats in certain areas of Dubai.
The figures come as a time when the latest report from the Royal Institution of Chartered Surveyors shows that sentiment in the United Arab Emirate real estate investment market improved during the second quarter of 2012 boosted by the rising availability of funds.
Its latest Global Commercial Property Survey said purchaser enquiries rose for the second consecutive quarter and transactions are forecast to rise in the coming months. It said expectations for capital values in the UAE for the third quarter show a modest increase for the first time since 2008.
The survey also showed that 16% more respondents indicated that money available for investment in real estate increased during the second quarter of the year and that occupier demand, led by an active retail sector, continued its rise, though at a slightly slower pace.
Indian buyers currently hold the top position for the total number of properties bought in 2011, with Pakistani and British buyers coming a close second and third respectively, highlighting the demand for property in the emirate.
This trend has been noticed by property specialists like Knight Knox International.
‘People are starting to have more confidence in the stability of the market. At the height of the boom, properties were selling for Dhs4,500 per square feet yet the same properties are now selling for Dhs1,700, a fraction of the price for the same quality,’ said the firm’s property consultant, Mike Sefton.
‘The demand for both off plan and built developments is surprisingly similar, proving that investors are confident of long-term opportunities within the country,’ he added.
As a result of the increasing amount of interest Knight Knox International has recently launched four new developments, ranging from boutique apartments to serviced hotels, to cater for all tastes and requirements.
These include studios, one, two and three bedroom apartments in the Burj district area starting at £405,135 with a management option predicting 25 to 27% returns within four years from purchase that are due for completion in February 2013.
Lower down the budget scale is apartments in Ocean Heights, a boutique tower development located at the entrance to Dubai Marina offering views of the Persian Gulf and access to nearby golf courses and beach clubs starting from £273,485 with a freehold option.