Question: I am new to the Gulf region and am considering buying a property in Dubai. Real estate agents paint an amazing picture of the market’s future. However, I've noticed that there’s an unlimited supply of new properties being built, which makes me cautious.
After talking to friends, I feel one needs to stay watchful about the market potentially being overpriced. What’s your opinion on the property market in Dubai and the UAE in general? Is the market actually as strong as agents say, or should I exercise caution?
Also, considering that Dubai seems crowded and possibly steep, what would be your recommendations for upcoming areas in the UAE? Are places like Sharjah or others worth considering? MJ, Dubai
Answer: It’s easy to be swayed by any opinion, but you only have to look at the facts before making your own decisions.
For some time now, the Dubai property market has been riding on a crest of a positive wave that doesn’t seem to want to diminish anytime soon. It is becoming a speculator's dream to be able to time the market, but nobody knows how to do it.
Logically speaking, what goes up has to come down, but when I asked you to look at the facts, I was referring mainly to the population growth.
For some time now, the number of inbound residents has been larger than outbound, which means the population is growing faster than the number of units being delivered. The fact is that there are more people coming to make Dubai their home than the number of properties being handed over.
Then, add other positive factors such as the 10-year golden visa, the investor visa, the ease of doing business, business-friendly local and federal governments, zero income taxes, low corporate taxes, low VAT, safety, the economy and weather.
This is why the population is growing. It would be foolish of me to say that the property market will continue to go up, because there will come a period when house prices will stabilise. But as long as the net migration is greater than handover of properties, the status quo will continue for some time.
My prediction is that for the next two years at least, we will continue along this phase before we see any difference. If the population rises further than is currently growing at, this real estate bull run could go on beyond 2027.
Other emirates are developing their own real estate. Umm Al Quwain has Al Siniya islands, Ajman has Al Zorah, Sharjah has Arada and Ras Al Khaimah has Al Marjan and Al Hayat islands.
Q: One of my real estate friends told me that Dubai property is a bubble because the city is creating artificial supply. As the need for housing increases, more properties are created as long as there is land available.
But if you constantly keep building, eventually you’ll have more apartments than occupants or people may be outpriced, which is when prices will drop.
The city will then be dependent on completion of development projects to attract more tenants. Consider the type of people entering the country and their income bracket.
It’s ironic coming from a real estate agent, but his justification is that he’s only there to make money off commissions. Is this a bubble? GT, Dubai
A: Everyone is talking about a bubble. What they have to understand is that when economists talk about a bubble, it’s due to many factors.
I have been through two real estate downturns in Dubai. The first being the world financial crisis in 2008/09 that affected everyone and the real estate downturn of mid-2014, which lasted at least six years. What is different between then and now are the fundamentals. The reasons for the bull run are down to supply and demand and this imbalance is due to the sheer number of people wishing to make Dubai and the UAE their next home.
As long as the net migration of population continues, this buoyant real estate market is likely to last for two more years at least.
What goes up must come down and this might be possible in a few years’ time, but if it does happen, it won’t be a bubble that has burst, it will rather be a period of stability where prices neither go up nor down.
Having said this, if the population grows even higher than the current rate, we could see this real estate bull run go on for much further than just a couple of years.
To what your friend said about being here for the commissions, this is a sad state of affairs. Unfortunately, there are some individuals who think this way, and as a result, will bring the real estate sector into disrepute with shoddy work, bad advice and terrible service.
I would tell any potential client to do their due diligence and seek professional agents to work with.
The opinions expressed do not constitute legal advice and are provided for information only. Please send any questions to mario@novviproperties.com
More from Rashmee Roshan Lall
Mane points for safe home colouring
- Natural and grey hair takes colour differently than chemically treated hair
- Taking hair from a dark to a light colour should involve a slow transition through warmer stages of colour
- When choosing a colour (especially a lighter tone), allow for a natural lift of warmth
- Most modern hair colours are technique-based, in that they require a confident hand and taught skills
- If you decide to be brave and go for it, seek professional advice and use a semi-permanent colour
MEYDAN RESULTS
6.30pm Baniyas (PA) Group 2 Dh125,000 (Dirt) 1,400m
Winner ES Ajeeb, Sam Hitchcock (jockey), Ibrahim Aseel (trainer).
7.05pm Maiden (TB) Dh165,000 (D) 1,200m
Winner Galaxy Road, Antonio Fresu, Musabah Al Muhairi.
7.40pm Maiden (TB) Dh165,000 (D) 1,400m
Winner Al Modayar, Fernando Jara, Ali Rashid Al Raihe.
8.15pm Handicap (TB) Dh170,000 (D) 1,900m
Winner Gundogdu, Xavier Ziani, Salem bin Ghadayer.
8.50pm Rated Conditions (TB) Dh240,000 (D) 1,600m
Winner George Villiers, Tadhg O’Shea, Satish Seemar.
9.25pm Handicap (TB) Dh175,000 (D)1,200m
Winner Lady Parma, Connor Beasley, Satish Seemar
10pm Handicap (TB) Dh165,000 (D) 1,400m
Winner Zaajer, Fernando Jara, Ali Rashid Al Raihe
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
UAE currency: the story behind the money in your pockets
Poacher
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Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
UAE currency: the story behind the money in your pockets
The candidates
Dr Ayham Ammora, scientist and business executive
Ali Azeem, business leader
Tony Booth, professor of education
Lord Browne, former BP chief executive
Dr Mohamed El-Erian, economist
Professor Wyn Evans, astrophysicist
Dr Mark Mann, scientist
Gina MIller, anti-Brexit campaigner
Lord Smith, former Cabinet minister
Sandi Toksvig, broadcaster
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Ahmed Raza
UAE cricket captain
Age: 31
Born: Sharjah
Role: Left-arm spinner
One-day internationals: 31 matches, 35 wickets, average 31.4, economy rate 3.95
T20 internationals: 41 matches, 29 wickets, average 30.3, economy rate 6.28
About Housecall
Date started: July 2020
Founders: Omar and Humaid Alzaabi
Based: Abu Dhabi
Sector: HealthTech
# of staff: 10
Funding to date: Self-funded
Jewel of the Expo 2020
252 projectors installed on Al Wasl dome
13.6km of steel used in the structure that makes it equal in length to 16 Burj Khalifas
550 tonnes of moulded steel were raised last year to cap the dome
724,000 cubic metres is the space it encloses
Stands taller than the leaning tower of Pisa
Steel trellis dome is one of the largest single structures on site
The size of 16 tennis courts and weighs as much as 500 elephants
Al Wasl means connection in Arabic
World’s largest 360-degree projection surface
RESULTS
Welterweight
Tohir Zhuraev (TJK) beat Mostafa Radi (PAL)
(Unanimous points decision)
Catchweight 75kg
Anas Siraj Mounir (MAR) beat Leandro Martins (BRA)
(Second round knockout)
Flyweight (female)
Manon Fiorot (FRA) beat Corinne Laframboise (CAN)
(RSC in third round)
Featherweight
Bogdan Kirilenko (UZB) beat Ahmed Al Darmaki
(Disqualification)
Lightweight
Izzedine Al Derabani (JOR) beat Rey Nacionales (PHI)
(Unanimous points)
Featherweight
Yousef Al Housani (UAE) beat Mohamed Fargan (IND)
(TKO first round)
Catchweight 69kg
Jung Han-gook (KOR) beat Max Lima (BRA)
(First round submission by foot-lock)
Catchweight 71kg
Usman Nurmogamedov (RUS) beat Jerry Kvarnstrom (FIN)
(TKO round 1).
Featherweight title (5 rounds)
Lee Do-gyeom (KOR) v Alexandru Chitoran (ROU)
(TKO round 1).
Lightweight title (5 rounds)
Bruno Machado (BRA) beat Mike Santiago (USA)
(RSC round 2).
Padmaavat
Director: Sanjay Leela Bhansali
Starring: Ranveer Singh, Deepika Padukone, Shahid Kapoor, Jim Sarbh
3.5/5
THE CLOWN OF GAZA
Director: Abdulrahman Sabbah
Starring: Alaa Meqdad
Rating: 4/5
Thank You for Banking with Us
Director: Laila Abbas
Starring: Yasmine Al Massri, Clara Khoury, Kamel El Basha, Ashraf Barhoum
Rating: 4/5
