Tuesday, October 14, 2008

Global Real Estate Fund Managers to be major boost to Dubai property market

The Gulf News has reported that a major capital injection by the managers of global real estate fund, could actually serve as a major boost to Dubai's property market, which is heading towards correction.

"With the UK and the US housing markets continuing their downward trend, the global real estate fund managers will continue to deposit cash into the UAE property market, and we hope that it will be a major boost to the market which may otherwise have slowed down, during the coming months," said Iseeb Rehman, the Managing Director, Sherwoods.

With more than Dh.600mn new project announcements at the recent Cityscape Dubai 2008, the Dubai property market is flooded with more sellers rather than buyers. This is hoped to bring down prices even further.

"The pace of sales has slowed down in recent weeks, and there are an increasing number of investors who wish to exit the market. This change is for the good, as the real buyers will not enter the market to purchase properties they wish to live in," said Rehman.

According to the global real estate consultancy, Colliers International, the overall growth rate quarterly, has slowed down from 42 percent during the first quarter of 2008 to 16 percent during the second quarter.

However, when compared to the performance of other cities over the same period, the returns offered by Dubai seem attractive.

These factors help in making the UAE realty market more attractive than the European and the US markets. The one-day operators and the like will vanish. The Chief Executive of NKR Properties, Kaleem Khan warned that there are several developers who do not have the right credentials, and are trying to attract buyers. He advised investors to apply caution before investing their money.

"The days of making a quick buck have gone. The real picture will be evident during the coming days. Villas from renowned developers such as Nakheel, Emaar, Aldar and Emaar Properties, will continue to appreciate in value. Even if the market corrects itself, it is no cause for worry," said Khan.

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