Investors fear UAE property market has yet to hit bottom

Only 19 percent of investors believe the UAE real estate market has bottomed out despite a jump in investor sentiment, according to Shuaa Capital’s June GCC investor confidence survey.

“Of special interest this month was the question of whether investors were calling a bottom for the real estate sector,” said Oliver Schutzmann, Shuaa’s chief communications officer and author of the report.

A majority of investors in GCC countries have yet to do that, with the exception of Saudi Arabia, where 37.1 percent of respondents have called the bottom, 28.1 percent are undecided and 19.1 percent are still negative on the real estate sector.

The remaining respondents did not have an opinion on Saudi real estate.

In the UAE, 34.8 percent were negative, 27.0 percent were undecided and only 19.1 percent said they thought real estate prices had hit bottom.

Qatar was the only other market where real estate has “almost” seen the worst, Schutzmann said, with 27.0 percent of investors having called the bottom, while 30.3 percent were undecided and 28.1 percent were negative.

Shuaa’s Gulf-wide investor confidence index, which is the only one of its kind in the region, jumped 14.1 points to 133.5 in June, boosted by the UAE, where sentiment swung to positive from negative.

A number greater than 100 represents positive sentiment.

The UAE index witnessed the highest increase in investor confidence, rising 16.8 points to 123.8 points on the month, while Qatar posted the highest score at 141.6 points, followed by Saudi Arabia, which was unchanged at 139.9 points.

The Oman measure rose by 13.1 points and now stands at 117.7 points.

Both Bahrain, up to 109.8 points from 96.8, and Kuwait, up to 103.1 points from 87.3, are now in positive territory.

The survey was conducted between June 13 and 16.

Ninety institutional investors responded to questions about current and future economic conditions, stock markets, sectors, currencies and commodities.

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