The UAE real estate sector in 2018 has witnessed major developments that include new laws, initiatives and projects announced. Moving into the new year, the UAE property outlook in 2019 is characterised by optimism. Bayut weighs in on the different factors that will likely impact the UAE real estate market in 2019.
UAE PROPERTY OUTLOOK IN 2019
As experienced in 2018, sales and rental prices are also expected to decline in 2019, due to a large volume of supply. Though continuing in the same vein, the price changes are expected to be modest, and rate of decline may slow down. However, the long-term UAE property outlook in 2019 remains positive. The declining property prices in the UAE makes the market favourable for investors and tenants. Attractive prices for completed properties has also widened the pool of buyers. Additionally, the new year may see an increase in first-time buyers entering the market. Declining rents across the UAE will give tenants the chance to upgrade to bigger homes or more premium locations.
Another factor that plays into the UAE real estate market forecast for 2019 are the variety of flexible payment plans being offered on off-plan projects. Appealing post-handover payment plans should open up the investor pool, affording end-users more ease when purchasing these properties.
The demand-supply mismatch will also make developers more creative when attracting buyers. As such, rent-to-own schemes should also gain momentum in the coming year. This makes it opportune for end-users who have resisted purchasing property due to lack of down payment funds. Such schemes allow developers to market to tenants who hadn’t considered investing earlier, thus boosting the UAE property market in 2019. Already, certain properties in prominent developments like Dubai Sports City and Al Furjan are being offered with such rental schemes.
The upcoming Expo 2020 is also expected to have a positive impact on the Dubai property market. The Dubai real estate market in 2019 could benefit from the potential increase in economic activity as the Expo 2020 inches closer, bringing in tourists as well as new residents to the country.
Other factors to consider in the UAE real estate market forecast for 2019 are the new laws that were introduced the year before. The new 10-year residency visa in the UAE could give eligible residents a stronger feeling of permanence in the country and increase property investments. The five-year retirement visa – with the condition of owning a property here – could also see more residents viewing the UAE as a long-term option.
Last year, the DLD launched the Real Estate Self-Transaction (REST) platform, part of the Dubai 10x initiative. This platform would allow the digital management of all property-related transactions, as well as access to other services. RERA has also launched Taqyimee, a smartphone application for real estate valuation services. It will connect real estate owners and investors to valuators, reducing the time and cost involved in the process. These premium services are all in line with the plan to make Dubai the smartest city in the world. The real estate market could also witness an uptick in light of these new initiatives launched by the DLD. These digital platforms will increase transparency in the Dubai property market in 2019, make it more investor-friendly and provide ease of access to real estate services.
The final major indicator of a positive UAE real estate market forecast for 2019 is the unprecedented number of real estate transactions recorded in the last 10 days of 2018. The DLD recorded 2,081 transactions between 17 to 30 December 2018 worth AED 19B. This rising trend is expected to continue in 2019, according to the Director General of the DLD. It also affirms the attractiveness of the UAE property market, and investor confidence in the real estate sector.