Weekly Dubai real estate news digest. Issue 13

29.09.2013
    A step in the right direction 
Welcome to the thirteenth issue of Market Insight, your weekly guide to what's happening in the Dubai real estate market.
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MARKET INSIGHT. Weekly guide to Dubai's property scene
Issue 13 |  September 29, 2013

A step in the right direction 

With property prices skyrocketing, the market has been abuzz with rumours that Dubai is heading towards another property bubble. However, new regulatory changes that have been announced in the past week should help assuage some of those concerns. 

The Dubai Land Department (DLD) has announced a new Rental Dispute Settlement Centre, which will look after rental disputes between landlords and tenants. While it might not appear to be a drastic measure for investors, it will definitely help in promoting greater transparency in the market. 

The department has also announced that it would double the transfer fee on each sale as a measure to protect the rebounding property market from speculators. It is aimed at stopping people from making a quick sale to make a small profit. 

Meanwhile, H. H. Sheikh Mohammed Bin Rashid Al Maktoum, vice president and prime minister of the UAE and ruler of Dubai, has issued a law, clearly defining the role the DLD plays. The department will now also be responsible for drawing up policies and plans that are in line with the development of the emirate's strategic plan to regulate and develop the property sector.

Dubai has also become the first property market in the world to support international property measurement standards (IPMS). These are being developed to address problems created by multiple measurement standards. 

The emirate is taking steps to work on rules that can protect the realty market. Sheikh Ahmed bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee, said that the last property bubble was the result of a global financial crisis. However, he added, "We are working on our regulations. Sometimes, I don't see that [high property prices] are a good thing. We don't want Dubai to become an expensive city." 


Market Insight is aimed at examining the emirate's dynamic market and forecasting industry trends. Dubai's realty sector is still relatively young and while these announcements are great news for the market, this is just the beginning for regulatory changes that are bound to be implemented. We hope that our round-up of stories and expert opinions has helped you get a better idea of the risk factors in the market, but also the measures that are currently out there to protect investors. Be sure to catch our next issue to know more about the latest in industry trends. 

 

Sincerely,

Pashma Manglani

Editor


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Dispute settlement centre receives industry welcome 


A newly-announced Rental Dispute Settlement Centre has been welcomed by industry experts as a stepping stone towards better market regulation.

The centre is set to replace the existing Dubai Municipality Rent Committee and will have authority over rent disputes between landlords and tenants within Dubai and its free zones. Over 200 disputes will be heard with verdicts delivered, each week by 10 committees, with the stated aim of resolving disputes within an optimum timeframe of 15-30 days. According to Craig Plumb, head of research in the MENA region, Jones Lang LaSalle, the centre will most likely affect areas with already h

Sallie Bowtell, senior associate, Trowers law firm, sad, "One of the key difficulties with the current committee is that it's quite a time consuming process. It's good that they will have a specialist committee, which means disputes can be resolved efficiently."

According to Craig Plumb, head of research in the MENA region, Jones Lang LaSalle, the centre will most likely affect areas wth already high rental growth rate. 


Read more on Gulf News


Prime properties see highest hike


Capital value at the Burj Khalifa and Le Reve, an ultra-luxury tower, have risen by 27% and 30% respectively in this year (up till June), a new report reveals.

Global property consultancy Knight Frank said in its report that though apartments were lagging in capital appreciation to villas at the beginning of 2012, they have gained since Q4 2012 with high quality units in Dubai Marina, Downtown and Palm Jumeirah showing strong performances similar to that of prime villas.

Le Reve prices went up 2.5 to 3 times higher at the end of Q2 2013 than at the launch, having risen nearly four times the original price at the peak of 2008. Prices in Burj Khalifa rose 32% in the first five months of 2013, compared to the same period last year.

 

Read more on Emirates 24/7


Transfer fees doubled 


The Dubai Land Department has said it would double transfer fees on each sale to 4% of a property's value from October 6.

The move was announced as a measure to protect Dubai's rebounding property market from speculators. "It won't affect the health of the market," said Sultan bin Mejren, director general of the Dubai Land Department. According to him, it will only stop people from making a quick sale to make a small profit. 

 

Read more on The National


'No. 1 housing market'


Dubai continues to hold the top position on Global Property Guide's list of highest price rises recorded across 42 cities for the second consecutive quarter of 2013.

The organisation, which collects real estate data from across the world, said prices climbed by 17.99% during Q2 2013. House prices had declined by 53% from 2008 to Q3 2011 but from the second quarter of 2012, Dubai has witnessed recovery, supported by the country's robust economic growth.

 

Read more on Emirates 24/7


Investor interest shifts to highways
 

Prospective buyers now have more options to choose from with developers upping project activity, especially on the Mohammed Bin Zayed Road.

The Falcon City has already built up scale, while the strictly Al Barari community is adding to its already extensive list of features and new living spaces. At the same time, the promoter of City of Arabia - IMG - has stressed that in addition to dinosaur and superhero theme parks, they will be working on a residential project as well.


Read more on Gulf News


Dubai first to adopt new international standards


The UAE has become the first country to officially support international property measurement standards (IPMS) which aim to stamp out the problems created in the real estate industry by multiple measurement standards.

The IPMS is being developed by a coalition of 22 professional and not-for-profit organisations from around the world. It will address global inconsistencies in the way property is measured, leading to greater transparency and increased investor confidence.


Read more on Property Wire


Law defines Land Department role
 

His Highness Sheikh Mohammed Bin Rashid Al Maktoum, vice president and prime minister of the UAE and ruler of Dubai, in his capacity as Ruler of Dubai, issued Law No. 7 of 2013 regarding the objectives, tasks and jurisdictions of the Dubai's Land Department.

According to the law, the department will work on achieving the government's strategic objectives for the realty sector by developing property registration systems that keep abreast with those used globally. It will also be responsible for improving its capabilities in regulatory and real estate control operations, as well as managing and developing the rental sector.

 

Read more on Gulf News


Nakheel set to sell 942 townhouses
 

Nakheel plans on selling 942 townhouses next week as the Dubai developer ramps up sales ahead of an Dhs8 billion debt deadline in 2015.

The company announced it would be taking orders for the Dhs1.7 million-plus properties close to its Dragonmart outlet mall. The Warsan Village project will also include 250 flats for lease and construction is expected to begin in 2014 (with completion predicted 20 months later).


Read more on The National


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