The UAE real estate sector went through a rough ride during the intense phase of the global economic crisis. Prices eased, leaving many buyers, mostly mortgage borrowers, underwater.

This year the GCC investor can expect some property bargains, as price softening will continue in some locations. Due to price declines, securing units of good quality might be difficult.

Banks are expected to lend more, but loan-to-value ratios will remain tight. Overall, investor sentiment will remain cautious, but experts in the real estate business said that those who know the market so well will see opportunities for greater returns.

Charles Neil, CEO of Landmark Properties, said that 2010 was similar in many respects to 2009 although the pace of declines in sales and leasing prices slowed down.

The group foresees further price and leasing decreases this year between 15 and 20 per cent, as more residential and commercial units are delivered.

"However, in certain locations and for certain quality products, prices seem to be levelling out and investors who continue to sit on the sidelines will find that it will become more difficult to secure these types of properties," Neil told Gulf News.

"Prices will fall where new projects are being delivered and people who have difficulty finding the money for the final payments will be active sellers and there will be bargains. We expect that once the current deliveries of villas ends, prices of these will stabilize quite quickly.

"Deliveries of new villas will practically end in 2011 and will become more sought after," he added.

While he expects certain product prices to stabilise, Neil said some properties like the villas on The Palm may even show small increases.

Given the current scenario, people are advised to avoid investing in real estate this year. "Buy a house if you need a home, but not as an investment in 2011. You are not likely to make a profit if there are no buyers in the market. And without mortgages, there are almost no buyers in the market.

"This applies globally. In my view, prices are more likely to go down than up, at least until banks start to lend mortgages of more than 75 per cent loan to value," Steve Gregory of Holborn Assets, said.

"Stay away [from real estate] in general, although some markets are beginning to bottom out and offer long-term value," Dr Jarmo Kotilaine of NCB Capital said.

However, if you really want to invest in real estate, Neil said that some of the key things you should be looking at are location and quality. A property overlooking the water will always command a premium, and a villa is likely to see more appreciation than an apartment, as supply will be limited.

"Other things the investor should be looking out for to enhance his investment is the quality of the community, if it is a villa. Check the landscaping, shops, maintenance of the common infrastructure. For apartments, look at the quality of maintenance and the effectiveness of the Owners Associations.

"Is there a sinking fund for replacement of elevators and chillers? Who are the occupants in the building? Check the views, what shops occupy retail spaces and amenities such as gardens, gyms, swimming pools," Neil said.

Are you planning to invest in the real estate sector in 2011? What expectations or concerns do you have?