Sales of apartments, villas and commercial properties in Dubai are rising due to oversupply and low prices, but off-plan properties continue to attract investor interest due to a bevy of new regulations aimed at boosting sales, and the trend is likely to continue in 2020
According to Dubai Land Department, last month set a record for the most Dubai property sales since 2008 with close to 5,000 transactions.
Off-plan properties account for 59 per cent of the residential transactions to date and are favoured by investors due to attractive prices, payment plans and fee waivers, according to real estate marketplace Property Finder.
With a surge in off-plan sales in recent months, it seems there’s something in the air, said Naval Vohra CEO at Appello Real Estate.
The dynamics of the market have recently shifted, and it is having a huge impact on off-plan sales.
“I think these three factors – the UAE Central Bank getting rid of the seventy-year age limit for the last mortgage repayment in order to ease mortgage loan requirements for customers of banks and finance companies; the lifting of the 20 percent cap on real estate lending for banks; and the excitement of finally approaching Expo 2020 – have all come together to create a bit of magic," Vohra said.
"And with plenty of bargains around and enticing payment plans in new projects, Dubai’s off-plan segment is once more looking very appealing to global consumers,” he added.
Aron Lomax Managing Partner at Treo Homes, thinks Dubai Expo could be a major trigger for off-plan sales next year, but mostly in commercial properties.
"Off plan sales are going to be very specific with office spaces within Dubai Expo. The developers I have spoken to are planning very specific campaigns and offices tailored for Expo," Lomax said.
But the central bank's advisory to remove the seventy-year age limit for last mortgage repayment will only have very little impact on off-plan sales, he said.
"Majority of the investors buying off-plan properties are usually led by attractive payment plans offered by developers, interest free in many cases, and not by the mortgage plans," he said.
(Writing by Seban Scaria email@example.com, editing by Anoop Menon)
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