Analysts and developers give different figures on how many new property units will be supplied to the Dubai property market in the near future. UAE leading consultancy Reidin unveiled its final report, which says that only 9397 new housing units were handed over in 2015 in Dubai, while other sources have predicted a 25,000 new units influx to the market at the beginning of the year.
The ambiguity of the forecasts often giving completely opposite estimates of the Dubai housing market state has caused criticism from some of the developers, including the head of Damac Properties. Thus, Dubai authorities are developing a new law that would limit private analytical agencies’ rights to give forecasts for the real estate market.
On their part, analysts including JLL defend their reputation by saying that figures in the forecast of 25,000 new housing units were taken from official data provided by the developers. But only 40-45% of planned units actually get delivered in practice, said JLL calling this phenomenon the “materialization rate". Thus, when taking into account analytical forecasts one should always consider this "materialization rate" correction, experts advise.
However, regardless of any forecasts, Dubai developers have really chosen a more wait and see strategy in delivering their planned real estate projects in 2015. This allowed Reidin predict that housing prices in Dubai may start going up again next year.
According to Reidin, only 31% of the planned supply will be handed over in Dubai in 2016, which is approximately 7,500 units, even less than in 2015.
On its part, Dubai Government has an intention of making private analytical agencies seek permissions from the Dubai Statistics Center before publishing any forecasts, so as not to misinform potential investors and property buyers.