Wednesday, July 05, 2006

UAE northern emirates lights are shining bright

Northern emirates are generating plenty of excitement in the real estate industry, and many residents are relocating away from Dubai.

But, in truth, the pace of construction activity in areas such as Ajman and Ras Al Khaimah is neither a challenge nor a threat to the maturing market of its neighbouring emirate. The ambitious developments taking shape around Dubai will be complementary to the overall profile of the UAE as a leisure, residential and business destination. Ajman’s current optimism is the result of combined forces. Expected clarification of leasehold ownership, comparatively cheaper rents, larger living spaces and the ever increasing population have all driven demand in the emirate.

Whether the Northern emirates represent a better investment than Dubai at the moment depends on the individual needs of the buyer. At present the leasing market is very strong, especially for commercial space, as large companies are moving supporting office divisions out of Dubai.

Needless to say, the lack of supply and increasing residential and commercial property prices in Dubai and Sharjah are pushing demand up for the other emirates such as Ajman and Ras Al Khaimah.

As far as legislation goes, Ajman does not have a freehold law as yet, but one is anticipated within the year to coincide with the main property law.

Ajman is an untapped market: land is cheaper and its easy access to the Emirates Road makes it a perfect alternative for those who cannot afford Dubai. Ras Al Khaimah also holds great potential, targeting a different marketplace and lifestyle in comparison to Dubai. We see more holiday getaways, resorts and investments from residents who want a second home away from the city.

With the entire country undergoing change and growth at the same time, it is difficult to say where the market is headed. But, we think this growth is positive as it will help ease the pressure (and traffic) off Dubai, helping other emirates prosper as well.

[Article from Emirates Today on October 5, 2006]

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