A survey conducted at the end of last year by Borderless Access research company showed that 83 per cent of the UAE’s small and medium-sized business representatives consider it necessary to further develop the sector of affordable commercial and residential real estate. 500 surveyed businessmen responded that an injection of a big number of low-cost housing units should make the region's economy healthier and stronger.
More than a third of respondents strongly agreed with this fact, while about a half agreed, but with certain reservations. And only 17 per cent of surveyed businessmen disagreed with the main statement of the study.
According to the international definition, a property can be considered affordable in case when byers (i.e. owners) spend no more than 30 per cent of their monthly income on it (as payments for off-plan property units or mortgage payments, or both). In Dubai, this figure still stands at an average of 40 per cent of a total household monthly income.
The lack of affordable housing is a threat to economic stability and competitiveness of the emirate, JLL Mena experts claim. But the Dubai authorities are well aware of the seriousness of the problem, thus having launched appropriate programs to resolve it. Developers responded; and now 78 per cent of all housing units under construction in Dubai can be attributed to the affordable category with prices below AED 2 million, while 51 per cent of the off-plan real estate units being built relate to the lower price category with price tags under AED 1 million per unit. Yet, how many of these will actually see completion is still a question of time.
However, flooding Dubai peripheral areas with cheap housing also has its drawbacks in the long term, the major of which could be a sharp increase in service fees due to lack of apartments actually sold. Besides, Dubai still has got its global status of the "millionaires’ magnet", and the exclusive high-end property construction still takes an important part in the general plan of the future Dubai’s urban development.