News on Property in Dubai

A new wave of investors is anticipated to flock to Dubai as their destination of choice. There is a recent trend where one can see the start of investment from regions that are more conservative in their property investments.

A popular international real estate portal recently reported that some earlier Dubai projects are now in the completion stage and that the concerned regions’ infrastructure have improved significantly, which is giving additional confidence to those previously hesitant investors.

Matthew Lanham, a Chief Technical Officer of a popular property portal remarked that “Dubai for us is providing huge interest and it makes sense to cater for our buyers who can now meet our own staff in Dubai. We find that some international buyers want to get a feel for the region before investing and our staff is on hand to do this. We have a team that can speak Arabic, English and French which is a real bonus.”

According to another property expert, Hind Jouini Chief, “Dubai is still expanding and is a relatively new market. There is so much opportunity here that many overseas buyers don’t know where to begin. Our presence in Dubai will capitalise on the interest in the region from the international community. Our clients come from UK, Pakistan, India, Middle East, and Russia. We predict that more conservative investors will soon be attracted to the region once they see projects coming to completion and see the huge infrastructure improvements here”

It has also been reported that the scale of the development in Dubai is causing problems with utility companies that are experiencing some difficulty in keeping up with the property developers demands.

Peter Riddoch, the chief executive of Damac Properties has outlined these setbacks by stating that: “Power and water supply is one of the biggest challenges facing Dubai’s real-estate sector. In a number of areas, the government is playing catch up”

In light of this, Dubai political authorities and property market rule makers have increased regulations around financing purchases of off plan property in the region.

This has resulted in three of Dubai leading banks launching escrow accounts. The new regulation centres on amendments in Dubai's property law which aims to increase transparency levels within the emirate's real estate sector.

Recent reports suggest that the Islamic banking division of Mashreq has opened the trust accounts as a result of Law No.8, which now asserts mandatory use of the account when buying an off-plan property in Dubai.

The CEO of Badr Al-Islami, Mubashar Khokhar has been reported to say that “the account would not only be ‘stringent’ but would also make buying off-plan ‘more transparent’. The real estate and construction sector today represents 22% of the non-oil GDP of the UAE. In my opinion this law will be a big catalyst to the industry and will carry on the momentum of growth for the next few years. Escrow will make buying off-plan more transparent. From a developer's point of view all of the accounts will be monitored, while buyers will have the knowledge that their money will not be diverted for any other purpose."

According to an additional report on Dubai’s developments status, it is clear that “some earlier off plan properties are coming to completion, Diamond Investments, a sister company of Diamond Developers, has announced finishing the handover process of Marina Diamond III, the third in the series of six buildings in the Dubai Marina.”

Fares Saeed, CEO of Diamond Investments said: “It is a pleasure to see our third building in the Marina full of the new owners and tenants. We are pleased to provide our customers with a different lifestyle full of relaxation in the Marina, where they can enjoy all the facilities available in this project. We expect to deliver Marina Diamond IV, V and VI later this year – which increases, along with the handover of Marina Diamond III, the total supply of residential units in Dubai by 1300 homes the handover of Marina Diamond III plays a role in alleviating the supply crunch in Dubai’s real estate market”

Many experts are of the general consensus that Dubai is about to see a new wave of investor wishing to buy property in Dubai.

Accordingly, Dubai is the location where not only commercial property but residential property is also rapidly being built and snatched up by various international investors, further illustrating the immense drawing power that Dubai still holds.