United Arab Emirates: September 21 - 2005
Dubai's real estate market poised to double this year
Dubai's real estate market is expected to reach between Dh12 to Dh15 billion by the end of this year, said a top official.
'The total value of individual purchase of real estate could cross Dh15 billion by December this year ? more than double of last year?s Dh7.1 billion,' Adel Al Shirawi, chief executive of Tamweel told Gulf News on Thursday.
'The mortgage market, we anticipate would be about Dh7 to Dh9 billion this year. We expect strong growth next year as well.
'Currently, 11 players including two home finance houses are active in the market, meeting the demand. As the market grows, there would be room for three to four more players.
'However, we do not anticipate a consolidation before the market matures, that is, until the secondary market and securitisation takes place on a larger scale,' he said.
According to market estimates, more than 11,000 buyers moved to new homes in Dubai since the market was opened to expatriate ownership in 2002. Emaar Properties, the 32 per cent government owned developer, has so far handed them over to buyers.
The number of buyers would be much higher, as more people are yet to move to the new houses.
A number of private sector builders would be delivering their properties to the buyers later this year. Next year, new buyers will move to their homes in Jumeirah Beach Residence and the Palm Islands, and this is expected to boost the repayment cycle in the mortgage market.
Established in March 2004, Tamweel brings together the legacy of two great organisations? Dubai Islamic Bank, the first Islamic bank in the world, and Istithmar, which is part of the Corporate Office that includes the Dubai Ports, Customs and Free Zone Corp, Nakheel, Dubai Metals and Commodities Centre and Tejari.
Tamweel crossed the Dh1.7 billion mark within the first ten months of its operations, recording a positive profit in just the first year.
The company has also formed alliances with a host of developers and real estate agents, and has its own panel of approved developers. As part of its expansion plans, it recently inaugurated its second branch, which is a full sales and service branch, located on Shaikh Zayed Road.
Al Shirawi also denied that the market has softened.
'Whatever slowdown was witnessed was due to the summer season. I call it seasonality. The sale slowed down because residents went on vacation,' he said.
'Now everyone is coming back and we see a flurry of business in the coming months. So the market did not soften, but temporarily slowed down due to seasonality,' he said.
