Which is ‘go-to city’ in region for property buys?

By Sheena Amos

Skycourts in Dubailand, a huge area with rapidly growing population - Eudore R. Chand

UAE retains no. 1 spot as most appealing for GCC residents

DUBAI 11 September 2017: The UAE has retained its number one position as the most appealing country to invest in real estate in the world for GCC residents, while Dubai is the most preferred city, according to new research.

The latest Real Estate Barometer study, conducted in partnership between YouGov and Cityscape Global, asked GCC home buyers and real estate investors where they feel most comfortable investing their money globally, said Wam.

Some 45 per cent cited the UAE [up from 42 per cent in 2016], while 63 per cent chose the UAE from among countries in the Middle East specifically Collectively, 69 per cent of respondents chose Dubai as the ‘go to’ city for real estate investment, with two thirds (66 per cent) expecting the impact of Expo 2020 Dubai to increase property buyer interest in the UAE.

The research has been revealed ahead of Cityscape Global, which returns to the Dubai World Trade Centre from Monday 11 to Wednesday 13 September.

Tom Rhodes, Exhibition Director, Cityscape Global, said: “The research findings give us a great insight into the current market conditions and certainly help us and our exhibitors to set forecasts for upcoming real estate investment expectations.

On-site Sales

“With on-site sales permitted for UAE-based projects the first time at Cityscape Global this year, we anticipate a lot of interest from investors who will be able to attend the event to capitalise on attractive price options and make informed purchasing decisions directly on the show floor.

More than half (59%) of respondents who intend to buy a property in the next year prefer to buy in the GCC, with the average GCC budget sitting at US$717,000, compared to the average global budget of US$561,000. The most highly sought-after residential property to buy is the two to three bedroom apartment; 53% of respondents opted for this unit size.

Kailash Nagdev, Managing Director for YouGov in the Middle East region said, “The annual Real Estate Barometer is designed to track Middle East property market sentiment to help the industry expand with its future investors in mind.

“The 2017 study indicates a minor decline in sales and rental property prices in the UAE but overall real estate investment sentiment for the UAE looks positive. Respondents are telling us a strong regulatory framework, good supply of residential properties at different price points and the upcoming Expo 2020 will be the key drivers of a healthy outlook for Middle East real estate.”

Price Drop

Within the residential property price movement, the expectation in the market is for prices to come down; 56% of the survey respondents expect the sales price of properties to decrease in their country of residence, while 59% expect the rental price of properties to also decrease in their country of residence.

Survey respondents in the GCC indicated the importance of location in residential properties in the study, with 43% opting for close proximity to educational facilities, 42% for healthcare facilities, followed by grocery stores (35%) and place of work or business (33%). UAE residents, however, particularly prefer properties close to grocery stores, at 40%.

Rhodes added: “The research tells us that investors are seeking value for money (88%), good quality of housing (87%) and easy access to major roads (75%) when buying residential units, so these are all factors our exhibitors can promote and communicate to visitors at their stands this year.

“Additionally, we’ve seen a change of investor mind-set when it comes to the size of property sought after, shifting from one bedroom and studio apartments in 2016 to a majority (54%) seeking two to three bedroom apartments shown by this year’s results. This could signal a vote of confidence from investors and homebuyers as reports point to a rejuvenation in the real estate sector.”

Affordable Housing

The survey also highlights that exactly half of respondents feel that affordable housing is missing from the GCC real estate market, while 31% believe there is a lack of reliable brokers and 28% wish for better access to data comparing existing properties. Certain macro-economic factors emerge as elements of concern for potential investors; 72% cite the state of the local economy, 68% highlight a lack of trust in brokers and developers, and 67% show concern for the security in the market of interest.