(MENAFNEditorial) UAE real estate set for robust growth; a strong magnet for investors: TASWEEK
• Average return on investments is in whopping 9%-12% range: study
• Capital gain speculates the biggest challenge for real estate speculation
Dubai, December, 2013: The UAE Real Estate sector is on a very strong growth pedestal, and offers a robust growth potential in the coming months for the investor community, according to a comprehensive study by TASWEEK Real Estate Development and Marketing PJSC – an advisor and solutions provider for the sector.
As per the landmark study undertaken by TASWEEK, the UAE real estate market is set to witness amazing Return on Investments between 9% and 12% per annum, which will serve as a major magnet for local and international investors.
The study also revealed that the contribution of the UAE real estate sector to the country's Gross Domestic Product [GDP] would touch AED 111.4 billion by the end of 2013, which is expected to further surge to AED 118 billion by the end of 2014. The sector's contribution to GDP was AED 108.2 billion in 2012 and AED 99 billion in 2009.
The rising confidence in the markets of Dubai and the strong fundamentals in the markets of Abu Dhabi have led the growth in the real estate sector of UAE, the TASWEEK study said, adding the sector is set to continue the growth trajectory witnessed over the last three years.
Mr. Masood Al Awar, CEO of TASWEEK Real Estate Development and Marketing, said: "The UAE real estate fundamentals is set for a steady uptrend in the next few months, driving the overall optimism and growth potential on offer, thanks to the consistency and consolidation witnessed in the primary markets of Dubai and Abu Dhabi. We have strong market intelligence to suggest a major spurt in the growth with increased investor activity across a wide spectrum of real estate projects – from residential to commercial in both Abu Dhabi and Dubai. These residential projects will increase the amount of spending which will stimulate job creation."
"2014 will mark a major step-change in the growth of the UAE real estate sector, specially that world economic recovery started with Euro zone comeback and US housing growth pushing the mortgage lending and interest increase all of which will become more robust and sustainable. The prospects are good for the UAE's endured property market rally – Abu Dhabi's up-tempo market and Dubai's return as a preferred global real estate hub provide sufficient boosts to maintain momentum through next year," said Mr. Al Awar.
The TASWEEK study emphasizes very positive growth for the Abu Dhabi real estate, with price stabilization and recovery in select areas – driven by the unveiling of mega projects such as the AED 246 billion developments in the Western Region, which will positively impact the sector.
The residential and retail rental values in Abu Dhabi are also set to grow exponentially amidst the decision of the Executive Council to disengage itself from the annual rental cap in November 2013, the study said. Varying rental trends will remain in vogue across the UAE capital, with high demand witnessed around Al Raha Beach, Saadiyat, Al Reem Island and Corniche areas.
On the other hand, a comparative study revealed that the preferred investor interest for sale of residential units would target the Al Raha Beach, Al Reem Island and Al Reef Downtown neighbourhoods. No major changes were expected in the office rental structure, the study said, adding Al Raha Beach, Corniche and Khalidiya would remain preferred target areas.
The Dubai market increased by over 10% since the beginning of 2013, driven by the strong governmental support and improving confidence in the market amidst political instability in the region, the TASWEEK study noted. One of the advantages of Dubai is that it offers a world-class infrastructure for developments and projects across all sectors, it added.
The residential rental market would focus around Downtown Burj, Old Town, Dubai Marina, DIFC and Silicon Oasis neighbourhoods, while those keen on buying residential units would eye developments in Downtown Burj, Dubai Marina, DIFC, Business Bay, Jumeirah Lake Towers and Greens, among other areas.
Offices leasing market witnessed slower activity in Dubai, while prices increased in the prime locations and the new business areas such as the Sheikh Zayed Road in the midst of increasing investor demand, the report opined, with rentals focusing on Dubai Marina, DIFC and TECOM among the preferred destinations.
Moreover, the successful bid to host Expo 2020 will have a good payoff in terms of return on investment which contributes to attracting foreign capital as well as local investors. This will have a significant impact on the growing demand for real estate units of various kinds in Dubai over the next three years, it suggested.
TASWEEK Real Estate Development and Marketing has been showcasing its two core competencies of networking and extensive market knowledge as it continues its expansion into the international markets. The company offers expertise in Purchase and Sale of Strategic Assets; Asset Management; Joint Ventures and Strategic Alliances; and Marketing Consultancy.
About TASWEEK:
TASWEEK Real Estate Development and Marketing has been showcasing its two core competencies of networking and extensive market knowledge as it continues its expansion into the international markets. The company offers expertise in Purchase and Sale of Strategic Assets; Asset Management; Joint Ventures and Strategic Alliances; and Marketing Consultancy.
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