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Property enquiries up but not sales

Cleofe Maceda Gulf News
Property enquiries up but not sales - Property - Real Estate - UAE - Price Drop - Housing Crisis - Financial Crisis - Dubai - Burj Dubai

An apartment at The Lofts in Downtown Burj Dubai, one of the most desirable locations in town, was selling at Dh2.2 million last June.

Seven months later, the price dipped to Dh1.2 million, or about 45 per cent, according to one property consultant. Attractive price cuts like this are apparently bringing some investor interest back into Dubai's real estate market.

Dubai's property agents confirm that enquiries from potential buyers are indeed keeping them busy these days. Moneyed investors are slowly entertaining the idea that Dubai's property market has bottomed out and that there are some bargains waiting to be snapped up.

However, the rise in enquiries has yet to translate into sales. The good old days of selling a property extremely quickly are not yet back. Some buyers with available cash are still staying on the sidelines, waiting for prices to fall further, and while banks are still approving mortgages, requirements remain stringent. (See separate story.)

Property prices in some areas have fallen by as much as 60 per cent, most around 40 to 50 per cent, according to Matthew Asplin, sales manager at Cluttons, a property consultant. He says the Burj District, where prices were getting out of hand when the market was at its peak, has been the hardest hit by falling prices.

Most of the mature villas, like the ones at the Arabian Ranches, Meadows and The Lakes have not been hit as hard, but prices of certain properties there have dipped by as much as 50 per cent. Rates at Green Community also dropped significantly.

"Viewings have increased, but we are finding sales haven't. We have clients with cash or funding in place who won't commit to a sale as they think prices will still come down further," Asplin tells Gulf News.

Jeremy Sanders, head of investment and development at Sherwoods Property Consultants, admits that despite the seeming return of investor interest, marrying buyers and sellers is still a challenging task.

Sanders says there's still money to be drawn from major markets like Europe, Pakistan, India and Saudi Arabia, but it might take a while to restore investor confidence fully.

"There's still money out there. We're getting more enquiries now. That's good news. It makes one feel better. Our phones are busier, but they're not necessarily translated into deals done. Hopefully, things will get better, but it might take a while," says Sanders.

According to Rose Twyford, branch manager at Sherwoods, they made three sales last week and they have many viewings and sales in the pipeline. She says most of the buyers who have approached them recently are based in Dubai.

"Prices are more competitive in the market, therefore people are looking at end user products to buy as an investment & Popular areas to purchase a property are Jumeirah Beach Residence (JBR), Dubai Marina, The Palm and Downtown," she adds.

The extent of price cuts, Twyford says, varies from one location to another, but it usually ranges between 25 per cent and 40 per cent. "The Palm and JBR are two areas that prices have fallen. This drop in price is also relevant to certain owners with their own individual financial crisis."


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