Is Dubai’s Property Market Back?

As Cityscape 2012 draws to a close, what’s the verdict?

Who could forget those extraordinary scenes in 2006 when snaking queues of buyers waited outside Dubai property launches, chequebook in hand, flanked by bank reps perched at makeshift stalls waving glossy ‘LOAN HERE!’ signs.

It’s been a long time since we saw a sizeable queue outside any launch – property or otherwise. Until yesterday, that is.

For the last few months, local speculators and pundits have made a habit of waging their ‘will it’ or ‘won’t it’ bets on Dubai’s  property comeback.

But this week’s Cityscape Global event finally gave us our answer: a hesitant yes.

“This year’s Cityscape has beaten all expectations and has certainly been the busiest show in four years,” said Niall McLoughlin, senior VP at Damac Properties.

“It is a visual representation of the recent reports and commentary which confirms that the Dubai property market is back in a big way,” he said, perhaps slightly overstating the case.

However, Cityscape’s managing director Rohan Marwaha offered further cheer when he told Gulf Business that floor space had grown by 40 per cent this year.

With a clutch of medium-sized announcements from the likes of Meydan, Emaar, Damac and Meeras Holding, Cityscape maintained a gentle buzz throughout the week. And while the event may have been less 2006-steroids-style and more a quiet tea with your mum, the important thing to note is investor movement and confidence.

The latest report from research firm CBRE reveals Dubai’s residential market is continuing to perform well with both apartments and villa rents showing an upward trend during the third quarter.

According to data from Dubai’s Land Department, total residential transactions during the third quarter reached 2,876 as compared to 1,578 in Q3, 2011 – an increase of 82 per cent.

Yes, the overall volumes remain small, but the percentage jump is reason to be hopeful, particularly as other parts of the Dubai economy are thriving on the back of increased tourism and an overspill from the ongoing Arab spring.

Nearly 62 per cent of all recorded transactions during Q3, 2012 occurred in master areas such as Emirates Living, Palm Jumeirah, Downtown Dubai, Dubai Marina, Jumeirah Lakes Towers and Arabian Ranches, which confirms the general view that the best deals remain in the community-centred projects.

In value terms these areas recorded Dhs2.74 billion worth of deals representing 84 per cent of the total volume for Q3, 2012.

“The Dubai property market is well set and we must welcome this with cautious optimism but not get overly carried away. We must now all work together to ensure that growth remains stable and consistent,” added Damac boss, McLoughlin.