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85% believe real estate sector woes will get worse
by This email address is being protected from spam bots, you need Javascript enabled to view it on Tuesday, 18 November 2008
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Results 1 to 11 of 11
Posted on Sunday, 23 November 2008
PROPERTY PRICE CORRECTION
Posted by Padmanabhan at 17:19 UAE time
Sir
The property price correction is a long overdue issue. Particularly now with the construction cost dwindling with almost 50% drop in price of key building materials, it should happen right now. Ir you may estimate the cost of construction per square feet, you could appreciate the enormous profit that sector has been taking. With overseas investors getting western markets opened up with cheap property prices and also the potential to get permanent visa to stay in their possession, the interest in the ME properties should come down. With the alarm bell rang with the financial crisis, even the few expatriate workers who might have planned to take properties here will now back track. So it will really be mostly the gulf buyers who will invest in properties and in that case prices will have to be sensibly in line with potential cost of construction with rational value escalation. The earlier it happens, the better it is as the property market then will start to perform again.
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Posted on Friday, 21 November 2008
Worse yet to arrive
Posted by Profit Proof at 16:59 UAE time
The real effect in UAE will be felt in the first quarter of 2009. The real estate will hit the floor and you will have lots of building stuck half way through next year. So better sell and sit on cash. Even cash will devalue once the hoarding of USD stops and it will move to the next asset class GOLD.
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Posted on Thursday, 20 November 2008
It will get much worse...
Posted by brandaid at 14:26 UAE time
Guys, think about it...85% of the buyers are non GCC expatriates. In any other market people either have to rent or buy because there is no choice, but here, over 85% of the population can leave and go home. The fundamentals are very very bad! Banks aren't lending and when the next financial quarters figures come in in Jan 2009, you will see a major disaster here. The economy is fueled by construction which is fueled by speculators investing in the market, no speculators, no construction, no money overseas, no tourists, no tourists, no shopping, Dubai will be back to what it was in the 1990s. only about 5% of the population earn enough money to afford to buy properties in Dubai based on their income, but since they have to come up with about 40-50% down to qualify for a loan this number will shrink to about 2%. The best example is the California Gold Ruch in the 1880s, how many thriving developments turned into Ghost Towns over night. Would you rather buy property in a country where the vast majority of people HAVE to live there or a country where the vast Majority can just leave? Established markets are a safer bet, but to anyone left in the place who's job doesn't revolve around construction, real estate, tourism, hospitality or retail, rent will be cheap, because there will be masses of place available, either through desperate landlords or through banks (after forclosures).
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Posted on Wednesday, 19 November 2008
Expect the Unexpected...
Posted by Mohamed Maricar at 22:26 UAE time
I read an article about a year and half before in GN, where the author who was an analyst closed his statement by saying 'expect the unexpected'.. I think we still haven't seen the unexpected part of the Real Estate industry boom.
And in simple economics they say 'everything that goes up, comes down'.. so we have seen the rents go up, due to demand driven by construction and real estate boom. But now that we have all these properties (free hold) ready and no buyers, we can see them being rented-out at a more reasonable rates (unlike Aed 250K-350K p.a. for a 2-3 B/R aprtmt in Abu Dhabi).
And don't blame the news.. they are just trying to create a 'Feel Good' factor among the citizens and residents.
Only my opinion..
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JOb cuts
Posted by Aneesh at 21:03 UAE time
The worse factor has already started in the UAE realty, sector only it has not come to surface yet, internally many projects are on hold or cancelled. Some employers are forcing employees to take forced long leave rather than cutting their higher margin level which they have enjoyed over a long enough period. see more real panic soon
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Charles de Gaulle once said
Posted by Shilu at 17:00 UAE time
The late french president once said to famous Egyptian journalist Hiekal that US is a super great country but he fears that when it goes down it will take everybody with it. Irrespective of whether the issue today is really in the UAE economy or not, the US economy is going down at light speed and is taking everybody with it. The UAE economy has extensive links to the US economy either directly or indirectly through the European and other GCC countries... so the effect will spread and it is going fast.
The decision to wait or make the investment is dependent on each investor's situation. Through evaluation of all your options with careful consideration of your financial position, your plans over the next 12-36 month is the best thing you can do... don't panic and sell because perhaps you may find it more viable to accept the loss on the table than make it a loss in the pocket...
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Credit Crises Worsen - iwep.blogspot.com
Posted by Kapil at 14:04 UAE time
Well speaking abt the crises here...there is no transparency amongst companies and once fine day don't be surprised if 1000's of jobs are layed off. I would request Arabian business to perform a pulse check on the financial sector here to get the real picture.
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it's coming
Posted by hoey at 12:09 UAE time
my advice is to sell your property, well below market value while you still can. people are dreaming if they think rental yields can sustain with such market conditions. there are plenty of internal and external factors that point to a severe correction and this will lead to empty units... don't you think a 70% drop in just 3 months in the stock value of real estate companies is enough warning? it's not only foreigners who are selling but it is the big regional investors with plenty of insider information who are dumping their shares, and now their properties. one cannot sit on the fence and observe and dream that it can recover or that they can still make a decent profit on rents. it's gonna crash and fast.
don't forget, in dubai, with the lack of transparency in the media you will not know what hit you until the value of your home has plummeted. government and real estate "experts" will try to tell you otherwise.... don't believe the hype.
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Real state price
Posted by Nasir at 10:40 UAE time
With the current global economic crisis, the real state situation in UAE seems to go along with the worlds economy? As of now, the government intervention in banking and economy will sustain the current position of real state, prbably , save it from crashing.
Correction in the prices will be a normal phenomenon in the present condition. The real issue is, when the economy will bounce back , will the real state market touch the same level as of now? Untill now the rentals, which is one of the economic indicator for real state, are at the same level or moved slightly and not to a bigger extent.
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200 jobs lost
Posted by sid at 10:26 UAE time
With the lack of transparency that we have here specially when it comes to big companies, when they say 200 jobs are lost, I think it's more like 2000.
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Posted on Tuesday, 18 November 2008
real state will get worse ...
Posted by Madjedi at 16:58 UAE time
according to previous reports, prices had increased 70% from Jan 09 to Sep 09; so a 40% correction will take us back to Jan 08 price level, not a big deal, except for those who bought at the top!
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