It was a year of competitive offers, attractive payment plans and budget-friendly rents. While property experts expect many of the 2018 trends to continue, they also foresee a return of realistic pricing in the market and increased value offers to appeal both buyers and tenants.
With more competition between developers, homebuyers can expect various offers to come their way this year. “Four-year payment plans after handover are available in some projects, and I think the let-to-own scheme is likely to prove popular if they are introduced,” says Harry Tregoning, managing partner of Tregoning Property. “I expect prices to fall further in the first part of the year and then start to grow in the second half. By then the uncertainty Brexit has brought to the world’s economy should have settled down and people will start to have more confidence.
“There will be continued support from the sub-continent. There is also a concerted effort from Dubai to woo Chinese investors, and I think that momentum will build in 2019. I also feel that Dubai Hills is going to be a very popular new development.”
The resale prices in Dubai have taken a tumble, and the property experts consider that it is rooted to oversupply. Amine Housni, regional manager, Middle East, at Blueground, points out that the price decline has driven developers to become more flexible than ever, negotiating multiple payment plans to clear residential inventory.
“The landlords have moved from accepting only one cheque to accepting up to 12 cheques and post-payment plans in many cases, offering 13 months for the price of 12, thus enticing the tenant to take their property.”
Renting out property is also seen as popular alternative among the developers. “Renting out your property rather than selling it hides another benefit for developers, as adopting this solution gets them their desired margin in two or three years.”
The property sector is increasingly disrupted by technology these days. “Developers are trying to modernise their product and adapt to the new order of getting things done,” says Housni. He notes that several developers are now moving away from traditional platforms of promotion to the online environment.
“The time has come when renters will be increasingly able to view apartments, check availabilities in real time, sign a lease for the duration of their choosing, pay rent and file maintenance requests online,” says Housni. “The interaction with a tenant is also now disrupted by the 3D and VR experiences that permit tenants to sign a lease remotely. The whole experience is modernised with technology, and as this trend grows, tenants will become reluctant to rent out an apartment in the traditional way.”
The past year saw the market shifting with developers focusing on affordable luxury rather than high-end property. “Smart, investor-friendly projects, combined with a multi-year, post-handover payment plan, will be key offering by developers going forward,” says Ahmed Hesham, managing director of Gulf Sotheby’s International Realty. “Dubai property developers have also moved from dictating the price to following the price trends set by the consumer demand.”
Noting that around 19,881 residential units were completed as of October, with a further 14,707 units scheduled for completion early this year, Hesham expects rental prices to further go down 5-10 per cent in high-saturation and luxury areas like Downtown Dubai, Dubai Marina, Jumeirah Beach Residence and Palm Jumeirah. “Dubai’s property market will most likely remain in recovery mode until 2020, the prices will likely hit the bottom of a downward trend in 2019 or early 2020, mainly due to a further increase in supply and with weak demand,” says Hesham. “However, even though the market is bearish at present, there are plenty of positive signs of growth happening shortly, including a maturing property market, steps by the Central Bank to remove the minimum mortgage cap and a renewed demand from international buyers.”
Exclusive luxe offers
Luxury property buyers will see more attractive choices and exclusive offers. says Kunal Puri, Group CEO of La Capitale Real Estate. He expects more properties in premium locations to offer “very flexible payment plans”, encouraging buyers to opt for off-plan over ready property. “Additionally, initiatives from the government have already created a very positive impact on buyers,” says Puri, citing how retirement homes in Dubai could increase in demand following the introduction of retirement visas.