Job creation and growth in the overall economy will help boost demand, an official said
Job creation and increased economic activity will help boost demand for Dubai residential real estate this year, a senior government official said on Wednesday.
Dubai’s economy is expected to grow by 4.5 percent in 2012, up from an estimated increase of more than three percent last year, His Highness Sheikh Ahmed Bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee, said on Wednesday.
While the real estate and construction sector is forecast to decline by 2.5 percent this year, the Department of Economic Development said it was confident overall economic growth would lead to increased demand for real estate and help to ease the emirate’s oversupply issue.
“I believe by increasing and pushing growth in the other sectors, demand will increase in the real estate sector,” HE Sami Al Qamzi, director general of the department of economic development, told reporters on the sidelines of the Dubai Economic Outlook 2012 presentation on Wednesday.
At present, there are approximately 336,000 residential units in Dubai, with real estate consultants Jones Lang LaSalle forecasting that around 23,000 additional units will enter the market in 2012. Al Qamzi believed increased economic activity and job creation will help to soak up some of this demand.
“We are expecting more jobs to come and more people to come and we are expecting more demand in the real estate sector. I believe if other sectors start showing positive growth definitely it will have a positive impact on the real estate,” he added.
Earlier this month, the latest job index survey by Bayt.com and YouGov found that half of all businesses in the UAE said they plan to hire new staff in the next three months.
Of the 50 percent of UAE companies that say they will 'definitely' or 'probably' hire in the next three months, 44 percent say they will be looking to hire less than five people.
The survey added that the jobs outlook was more positive, with 63 percent of companies saying they will 'definitely' or 'probably' be hiring in a year's time.
Al Qamzi said the Dubai government was also working to try and increase demand in order to push growth in the real estate and construction sector in the positive direction.
“We need to come and work on some initiatives to push the real estate and construction sector… to show some positive movement. I believe the government is working towards these initiatives and to work to move this sector,” he said.