What is your take on the new residential supply entering the market?
I believe the problem we have at the moment is pricing, tenants and buyers just cannot afford the going rents so are sharing, which is leaving a number of units vacant in the rental market.
Is it the time to manage supply in Dubai real estate?
Definitely, most properties in the supply figures are already under construction so we do not want to stop construction but something needs to be done to streamline sales and planning approvals in the future. They need to look at the number of residents, salaries, and companies against what properties are vacant and accommodate appropriately.
Is it the time that regulators put a cap on a number of projects launched by a single developer annually?
There was an exciting announcement at the beginning of the year where projects will need to reach the 50 percent construction mark before developers could sell. The earlier requirement was for a project to be 20 percent constructed before sales could be launched. It seems that this has changed but we are not totally sure, if it does remain at 50% then we will see a more stabilised market
Are we heading towards an off-plan oversupply condition? Is the market stability at risk?
We will have over 250% more handovers in 2018 opposed to 2017. Properties scheduled to be completed in 2018 – (data from propertymonitor.ae)
What according to you the regulators to start doing to control the oversupply situation?
As above they need to slow down on approvals, make sure what is completed is occupied, attract more people into the country, prices of visas have doubled and cost of living is considerably more than previous years. They need to take this into account.
Are there enough regulations in place to limit the new developers from launching new projects? Or what is lacking in the market?
I have a seen developers launching on a monthly basis last year, this year it seems to of slowed down and you can see that their sales have fallen due to the large discounts, payment plans and availability left.
Are we seeing a lot of residential units remaining vacant in the present market?
Yes, but mostly due to people moving due to losing employment or landlords asking for unrealistic prices. I have also noticed that the age range of the population of Dubai has lowered. It seems that now the infrastructure/procedures of companies has been put in place by experienced older professionals, companies are now hiring younger professionals which in turn affects the market as they are getting less salary so are sharing properties.
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Have a great week.
Laura Adams, Managing Director, Carlton Real Estate.
(data compiled by Laura Adams, provided by propertymonitor.ae)