When it comes to real estate the name Donald Trump is synonymous with both investment success and luxury grade property and what’s more, the name carries a great deal of weight in terms of providing investors with deep confidence in a given project, a location and even an entire nation.
Therefore Donald Trump’s long term commitment to Dubai property, which he personally announced recently, bodes incredibly well for the emirate, its real estate economy and the long term success of property as an investment commodity in Dubai.
Amberlamb were recently asked to comment on the current state of the property market in Dubai. The answers submitted by the team to a questionnaire from Adfero, one of the UK’s fastest growing news agencies are published here so that our readers can be kept fully up-to-date and appraised of our ongoing opinions relating to Dubai’s investment real estate marketplace.
If you want to learn what Amberlamb think about property in Dubai today and where there may be potential for investors looking for both rental returns and capital growth in the future then read on…
The Dubai Rent Committee has, for a second year running capped rental rate increases in Dubai and now the debate relating to rent caps and buy to let property investment in Dubai is raging.
On the one hand you have the argument that it is necessary to cap rental rates to ensure Dubai remains an attractive place to live in terms of its economic competitiveness for the longer term; and on the other hand you have property industry experts pointing out the fact that Dubai’s economy actually benefits significantly from the property industry and by capping rental rates you’re effectively capping the attraction of the nation from an investor’s perspective.
There are too many global economic uncertainties that could negatively affect the property market in Dubai in 2007 for us to categorically state that an investor would be mad to miss the ever increasing property prices and rental yields in the UAE.
While there remains an incredibly strong driving demand for property in Dubai, a downward turn in the US economy, a drop in demand for oil or a supply to the market of excessive property stock for example could each put to an end the record rates of growth enjoyed by real estate investors in Dubai in the past few years and Dubai property could well be facing a tough 2007.
The situation in the Dubai property market right now is tenuous to say the very least – we have just had announcements from some of the leading constructors that projects such as Palm Jumeirah are up to six months late and we have received warnings from the National Bank of Dubai that inflation is spiralling upwards and creating economic risk. Combined with these factors is the news that there are substantial waiting lists for commercial and residential space in Dubai as reported in the International Herald Tribune this week and one has to ask oneself ‘where next for Dubai’s saturated property market?’
When researching a property market for its potential for profit there are a number of incredibly basic but absolutely essential considerations that every investor needs to cover. These include the current desirability of the location in question and what factors if any will result in continued demand for the location, the current and predicted supply and demand ratio and whether there exists a strong, sustainable and expanding local affordability trend.
As was widely predicted there have been positive movements in the Dubai mortgage market since the emirate’s new property law was finalised recently. Dubai investment property mortgages are now available in a wider form, from more lenders and for the purchase of property from the resale market.
Property investors in Dubai should have been celebrating last week following the passing of Law Number 7 on the 14th of March that finally allows for the foreign freehold ownership of property in certain designated areas in Dubai, but celebrations were muted.
International real estate investors interested in getting in on ‘the next big thing’ in Dubai are turning their attention towards properties for sale in and around Dubailand - the incredibly innovate multi dimensional theme park and entertainment complex currently being created in Dubai.
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