Smart investors who got into the Dubai property market during or around the lockdown have struck great deals for themselves.
I am not saying the market went up appreciably - but most sellers, if not all, who wanted to exit at any cost for one reason or another are already out of the market. Hence, the second wave of sellers are not as flexible as those who sold during the peak of market uncertainties.
The question that I often get asked is: Did real estate investors who entered the market three months ago get lower prices than today? The answer is certainly a ‘Yes!’, and in particular for prime locations As subprime locations take longer to recover. Again, not because the market has gone up, but because certain sellers who had to exit at any price are already out.
Especially communities that are limited in supply, such as Citywalk, Bluewaters and select pockets at the Downtown, are showing the best price resilience. Just before the lockdown, I published a video informing people that the best time for buyers is when sellers are under maximum pressure from uncertainties.
The minute buyers start seeing more clarity on the future of the market, sellers will see it too. Hence, sellers will be at ease rather than in a stress to sell out fast.
Don’t over analyse
My advice is that buyers shouldn’t overthink and hesitate if they are financially capable to invest in real estate and they have found the right property. They should execute on the most well-priced property they find. Sometimes, people take too long negotiating Dh100,000 less on a property that has dropped Dh2 million in price as compared to three or four years ago. Hence, they risk losing a top dollar for a penny.
The exclusive community of Al Wasel plots by MEeraas witnessed a few transactions at relatively low prices a couple of months back. But today, you cannot find any remotely close to those executed around the lockdown. Other examples are Citywalk and Bluewaters by Meraas and Dubai Hills by Emarr, and District One villas by Meydan.
After a few low priced transactions, those communities witnessed a fast recovery while interest from buyers continues to be high.
Don’t rush it
If you are a seller and you have the financial holding power, it is the worst time to sell. Hold on - the market will come back.
Another factor to consider is that a lot of the property ads you see on-line do not communicate accurate prices. However, it sets a mental benchmark for many buyers.
The true market price is often higher than most advertised by 5-20 per cent depending on the area. Sellers should not be misled and they shold always check the actual prices of the “real” transactions executed through Dubai Land Department.
While buyers should understand that if they called five agencies that are advertising the lowest prices and all five say these are no longer available, it means those are fake prices placed just to attract buyers. Or the prices are true but for properties that are sold.
The Dubai Land Department is investing a lot of effort to police the marketing of properties, and I strongly believe that the results of their efforts will come to the surface shortly.
Unless another pandemic and lockdown comes, I believe that we passed the worst phase in Dubai real estate market. Although I don’t see an immediate uptrend, I see it happening gradually. I can already see a level of price resilience and a slow upward trend at most prime locations.
- Firas Al Msaddi is CEO of fam properties.