Following the decree of the new Dubai Property Law in March of this year there has been a significant increase in the numbers of property investors and private purchasers seeking property for sale in Dubai.
This increased confidence in Dubai’s property sector has been reflected in the property development camp as well; AME Info announced today that USD 4 billion has been committed to new property projects in Dubai since the passing of the law.
The law, which finally confirms what many already accepted, i.e., that foreign purchasers have the right to own freehold title to real estate in certain parts of Dubai, has significantly boosted both the amount of property for sale in Dubai and also the demand for it.
According to industry analysis of the resurgence in interest in Dubai’s real estate sector, about 50% can now be attributed to private property purchasers. In the past Dubai’s property market was mainly driven by investors whereas today those who are moving to Dubai for work or lifestyle choices are buying up property as are those who seek a second home overseas in a strong investment environment.
As the numbers of Dubai residents increases by around 200,000 people annually so the demand for property for sale in Dubai is naturally increasing as is the demand for quality accommodation to rent. As rental rates have increased significantly in recent months because the amount of completed property available is in short supply in Dubai, so more and more people realise that buying real estate is actually far more cost effective over the longer term and it offers them a good investment as well.
Those who buy and reside in their properties save themselves rent; those who then choose to vacate their homes have a choice of letting them out to a market where demand is intense or reselling to a market where there is also intense demand for completed property.
Before the passing of the new property decree into law there had been a sharp downturn in the amount of new projects being started in the emirate. Investors and developers were maybe reluctant to further commit to a market where promises had been made but never delivered…but now that the government’s promises have been made law both local and foreign property development companies have been very swift to return to the market in force and commit substantial funds to the further development of residential and commercial property in Dubai.
According to the figures from AME Info’s report, USD 4 billion in new projects have been announced since the passing of the new property law on March the 12th 2006. Of the money committed well over half is coming from local developers; this underlines their unwavering faith in the Dubai property market and in its ability to continue growing and generating profit which should give overseas investors and property purchasers added confidence because if anyone understand the dynamics of Dubai’s real estate market it’s likely that the local property developers do.
