Real Estate Developers revise their offering, prices and payment plans to gain market share.
While the major established developers like Emaar Properties, Nakheel and Dubai Properties Group are still able to sell out projects with relative ease – there are now dozens of smaller, private developers that are building various types of projects across Dubai.
The competition is strongest on the mid-end segment. Hot spot areas of development include projects like Dubai Sports City, Jumeirah Village and the greater Dubailand area. With so much competition in this segment, developers are adapting to the market place with new, innovative campaigns and product placements.
A bit of background; Dubai’s real estate market crashed in late 2008 and between 2009 – 2011, the market corrected drastically with prices declining between 30 – 50% in some cases.
Starting in 2012, mainly as a result of instability in the region (remember the Arab Spring), billions of dollars poured into Dubai – largely being diverted into the local real estate market.
From 2012 – to late 2013, the market appreciated drastically. In order to cool down the market and prevent another bubble, the Government took a number of measures to prevent speculation. An increase in the mortgage cap, doubling of transaction costs and preventing off-plan buyers to resell immediately have all contributed to a slow down.
The slow-down has not been as drastic as once feared. The correction which began in mid-2014 has seen prices decline by 7 – 10% on average for most communities. Many of the small and medium sized investors have started consolidating their positions. Most mature communities have high occupancy rates and now witness less transaction