Dubai will soon be flooded with large number of new project launches as several major developers like to complete the schemes before 2020, as reported by CBRE.
According to Matthew Green – UAE Head of research and consultancy at CBRE – many developers will have a good chance to deliver in time if they begin with residential project launches in 2017. Considering this, the requests for feasibility and ‘best-use’ studies is going to increase. This is a golden opportunity since 2006-07 for major developers to sell. Reportedly, World Expo 2020 will have an opening on October 20, 2020.
As per the estimation, almost 70,000 units are on in-progress state to be delivered between 2017 and 2019 but this number is more likely to increase. This drastic increase supply will cause some deflationary trends that may result decline in rental rates. In fact, the average rent is decreased by 4 per cent last year and expected to fall by 5 per cent in this year whereas residential prices, which have been constant in last two quarters, will remain unchanged.
“The market has learnt some lessons from 2008-09, with developers more willing to phase handovers to match demand, citing Dubai Holding’s Jumeirah Central and Emaar Properties’ Dubai Creek Harbour as examples of projects planned over 25-30 years,” says Nicholas Maclean, MD, CBRE.
Bringing in more supplies can be absorbed as long as UAE economy keeps growing that brings a lot of employment opportunities.