Investor confidence key to real estate rebound - poll

POLL RESULTS: Restoring investor confidence was seen as key to the rebound of the real estate market in the GCC, according to an Arabian Business poll. (Getty Images)

Restoring investor confidence is key to seeing the GCC's real estate sector emerge from the current global economic crisis, according to the results of an Arabian Business poll.

The online survey asked readers what factors they saw as important in holding back a recovery in the Gulf's battered property market.

And investor confidence was the number one factor for 41 percent of respondents who believed it was still at an all time low regarding real estate markets, especially in the UAE.

The poll followed the publication on Monday of Shuaa Capital's August GCC Investor Sentiment Index, which showed a 2.7 percent improvement, compared to July although it was still below the level recorded in June.

It showed that the UAE and Qatar were the main drivers in the improvements seen in the Index with the UAE up 4.3 percent, with 17 percent of investors responding positively about the current state of the country's economy.

Another 36 percent of the hundreds of people who took part in our poll said it was prices that was still holding back the property recovery in the region.

They said despite huge drops in both house prices and rental values, up to 50 percent since their peak in 2008, prices still had a way to fall and investors were waiting for this before buying.

On Monday the UAE's Minister of Economy said he expects the economy to be "back on track" by the final quarter of 2009, adding that measures implemented by authorities would help spur the recovery.

But in our poll, 23 percent of respondents still blamed the actions of banks for adding to the problems relating to the global downturn. Eleven percent said their lending policies were too strict and they needed to be more flexible while another 12 percent accused them of keeping mortgage rates far too high.

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READERS' COMMENTS

to invest?
Posted by Dod, Dubai on Thursday 3 September 2009 at 15:07 UAE time


KJS - good comments in answer to a good question from Ahmed. However in your argument for investing in Dubai you included the fact that rents are declining. Surely that is a reason not to invest?

On infrastructure: raw sewage is still being pumped into the beach at Jumeira 3 because the sewage system is not adequate. End of story.

Dubai has a core strength as a regional trading hub that will keep it going, however I am a boo-boy to the extent that analysts and "experts" got it badly wrong a couple of years ago and helped sustain the madness that caused stress to all of us - buyers and tenants (disbelievers in the hype) alike

"VISA" is Confidence
Posted by ik on Thursday 3 September 2009 at 13:53 UAE time


Let the Govt. announce that it is going back to offering 3 yr. renewable visas to property owners & see how the market picks up again.

confidence
Posted by Tom on Thursday 3 September 2009 at 13:23 UAE time


The confidence will come from the honesty of the developers and the people who regulate and ultimately regulate them, we should have nothing to worry about then since we have rule of law. (I am talking about London)

KJS
Posted by Dan, Stockholm, Sweden on Thursday 3 September 2009 at 13:02 UAE time


There seems to be a miss conception about infrastructure with some people in Middle East. Although Dubai has great six lane highways and the upcoming Metro, these alone dose not stand for great infrastructure.

I can use Stockholm (the Swedish capital with 1.7 million populations) as an example. With regards to mass transportation, it has Metro and local train and busses covering every part of the city and the near areas. You can check all the departure times online or at the station. There is no guesswork. About 700.000 people every day use this system to get to and from work. You can use all of these unlimited for 320 Dirham/month.

But there is more to infrastructure. There has to be affordable fast and reliable communications, e.g. Phone, Internet. I have 100 Mb up and down speed at home for 110 Dirham/month. This in a country of 9 million and with countless internet/telephone providers’s competing for customers. (NO MONOPOLYS HERE). A new company can get access to internet in a day or two with very low cost.

All of your doings with various government departments are done by a simple phone call or online for free. Some are even done by the departments in advance without you asking for them. Your business dose not suffers from delays and you KNOW how much all these services will cost you in advance (taxes). No guess work about fluctuating or hidden fees.

These are just a few samples regarding infrastructure that provides opportunities for people, companies and the whole country to advance. As a Middle Eastern my self, I feel amused and sorry that every time we build a highway in our countries, we think that we got great infrastructure.

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