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Dubai rents to keep falling in Q3 - Landmark
by This email address is being protected from spam bots, you need Javascript enabled to view it on Tuesday, 23 June 2009Posted on Sunday, 28 June 2009
The die hard illusionist.
Posted by Paul King at 09:45 UAE time
After returning from an empty Choithrams and upgrading using my air miles with no problem at all, i've taken Omar's advice and goggled for the latest news and found this: In the month of May, Japan's exports declined 40% year on year.
Yesterday came similar news from Europe. Industrial orders in the Eurozone dropped 35% in April, from the year before.
"Fed on hold as slump eases," reports The Wall Street Journal. What exactly is meant by 'slump eases' is unclear. As near as we can tell, the slump is getting worse.
"New home sales plunged 32.8%." Bloomberg reports that house prices in California and Las Vegas are being hit hard by a wave of foreclosed properties. Yes, dear reader, the anklebone is still connected to the leg bone.
Bloomberg also reports, "jobless claims are up."
A fellow loses his job; he can't pay his mortgage. The house goes onto the market and pushes down prices. Prices in California are off 30% year-to-year, with the median house at $267,000. In Las Vegas, the median house is only $135,000 with 75% of sold properties coming from foreclosures.
The housing market is slow. But it works like other markets. It reacts...then, it over-reacts. It shoots. Then, it over-shoots. One study we saw said that housing prices were now down to "reasonable" levels. But there's no law that says they can't go to unreasonable levels. They were very unreasonable two years ago; they're likely to be very unreasonable in the other direction before this depression is over. Hold on; maybe you'll be able to get the median house in California for $199,000.
The WSJ notices that the leg bone is connected to the knee bone too, "house price falls are cutting into economy," it says.
Well, what did you expect? That's what house price declines do. People feel poorer because they are poorer. And with no source of ready cash - they spend less. Then...the whole economy weakens...etc....etc....... sounds familiar to me..
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Posted on Saturday, 27 June 2009
I hope so but do not think so
Posted by Omar at 23:40 UAE time
I keep on hearing that prices will go down but my eyes confirm that nothing is going down in Dubai ( i am closely monitoring the real estate sections in Gulf News (i check and call daily). I keep on hearing that people are leaving very soon and that Dubai will be a ghost town within days but i only get frustrated by the incredible traffic that is getting worse day after day. I imagined that with +50, 90% of people would leave at least on Holiday but instead everything is FULL in Dubai.
All supermarkets are full even the Choithrams are full and i queue for 30 minutes to buy some things!All streets are full and to get out of greens i need 1 hour!!!!
They say after school but nothing happened but instead higher prices and more people, now they are saying 09/09/2009 when the metro starts the demographic scene of Dubai would change but i do not think so....
In Dubai, nothing goes down, only up.
They say Emirates is facing some turbulence but i can not use my miles that are due to expire very soon bcz whenever i want to book they say sorry all seats are full!!
I hope people who are saying that just leave - JUST DO IT PLEASE. I beg you. JUST DO IT.
Everything is going up in Dubai. FYI, not only in Dubai, house prices rose in UK for the last 4 months so was the case in the US (i have solid reports - plz google).
We only hope that prices will go down but we ALWAYS get disappointed with higher prices wherever we go.
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Posted on Friday, 26 June 2009
Landmark Advisory
Posted by Mohamed Djirdeh at 02:02 UAE time
This what I was predicting all along.Dubai property prices and rents have not bottomed yet. May be mid 2010 we will see signs.
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Posted on Thursday, 25 June 2009
A racing certainty.
Posted by Paul King at 13:51 UAE time
Oversupply is producing deflation. Prices are falling as suppliers fight for demand by offering more for less.
This is what you'd expect at the end of a long period of credit expansion. Easy credit brought forth too much demand and too much supply. Now, the demand is disappearing...and the suppliers struggle to hold on.
Even now, we're facing an economy in which a high % of our economic output depends on consumer buying. No buyers, no recovery.
This is natural, normal and perhaps necessary to a market economy. And it will take years to sort out. Roofs have to fall in on thousands of enterprises, speculators and households. Then, the rebuilding can begin.
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@Agnelo - copy-paste expert
Posted by Umesh at 12:04 UAE time
I was "impressed"by Agnelo's comment...and did a simple google search because I didn't understand his economics jargon...and guess what...he's done a copy-paste from this webpage:
http://www.dailymarkets.com/economy/2009/06/24/the-great-recession-is-definitely-over-where-to-now/
Mr. Agnelo..who are you?
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Omar
Posted by Amused at 09:50 UAE time
Omar,
I guess you ar wraing out your Caps Lock key. You can still use the Shift key for all of your FACTS. By the way, FACT you have been writing that you can't get financing because real estate business is still so good rates are too high, yet FACT you wrote on 22 June that you were in a real estate office signing for a villa (whence the intorduction of the infamous agent's Mercedes). FACT today you wrote that your wife couldn't find a villa for a decent price. So what are the real FACTS or are you simply writingwhatever you want to make your point? I want the FACTS.
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BUY BUY BUY!!!
Posted by Angelo at 07:27 UAE time
Consumer confidence hit an all-time low in February at 25.3. It soared recently – hitting 54.9 in May. That's an impressive recovery!
The same thing happened with my best end-of-recession indicator... the ratio of Coincident Indicators to Lagging Indicators (CILI), put out by the Conference Board. When it bottoms, the recession is over.
The CILI ratio bottomed in February and March at 89.5. The latest numbers came out last week. The bottom that was hit back then has held.
Bottoms in consumer confidence typically come at the very end of the recession. These bottoms happened months ago... This recession is over – it ended a month ago (and I said so, before anyone else) So the wise investor should take advantage befor the rush - coz here no lessons will be learned and the property market will be back to square one.
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Posted on Wednesday, 24 June 2009
I hope so - really hope so
Posted by Omar at 19:23 UAE time
I hope so, really hope so. I wish. But the greedy landllords and the real estate agents and..... are very greedy. All prices must fall by 50% more. 1 bedroom in Greens is arond 75k (20k$). That's insane. More than what my friends pay in central Tokyo!!oking around, calling all numbers in Gulf News but prices, although they dropped 30% than last year, are still very high!!!Negotiable, they mean few thousand dirhams only. Still some villas are for 300k. My wife just called a number in Wasl Road and the prices are still 250K for a 3 bed villa!!That's 70k$$. That's insane!+ guess what?the lady who attended the call was rude and snobbish! Schools are almost over and prices still HIGHHHHand Traffic is still crazy! Where do people come from??!!
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Its a (smart) buyers market today
Posted by Juan Alejandro Vairo at 16:50 UAE time
I have the money, you must have the price.
To begin with, Dubai is not the apropiate landmark for this sort of realestate business, people buy there what they really don't need, and when people buy what they really don't need they either take their time to buy or wait until the prices drop drasticly.
The same smart (not so smart) people who developed Dubai had an idea to go to Africa and build in the middle of the jungle, as if...
Cities are built around infrastructurers, Dubai is a Disneyland for the rich only, how many times can you go to Disney?? Dubai is and will be a disaster, better sell now or never, buyers know that Dubai is just something in the middle of nothing, in other countries buyers are buying what was something good and will be again after the crisis, in Dubai it was nothing always, and it is nothing today, there is no future there because there was no past.
Want to invest, come to Argentina, land here is so rich yet so inexpensive today, and will be expensive tomorrow as it was before the crisis.
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Rents ... they are surely a-fallin'.... wait and see!
Posted by Rockstar at 16:18 UAE time
Mohammad, spot on! The summer is here and the majority of Expat population is leaving the heat box. The schools are almost out and in some schools, we have witnessed over 30% of numbers of students departing and not returning.
Come September, we shall see the real story .... who returns, what schools places are available and what rentals are on offer.
Right now, many schools are calling up debenture holders to offer them places that were never available to them for over 4 years! ... this is called PANIC. They want to secure some places before summer sets in and the population leaves. The schools do not want to wait and see if the students will come back because if they do not, the companies will start to remove the debentures from the schools and the schools will be faced with less caital reserves to meet the excessive growth and expansions. Good time to rent .. try late September and 4Q09... I am sure plenty of bargains then and some burnt landlords begging you to look in Jumeriah, Umm Suquiem and many other 'desireable' areas, now suddenly more affordable. And remember, negotiate hard and then walk away and think about it and come back with a lower offer ... that was what it was like in reverse only a few years back. Decide right now or the price will increase! Not nice when the shoe is on the other foot is it? Worrying times are still ahead.
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What do I care about the rubbish I said yesterday?
Posted by Jebel Ali Baba at 14:02 UAE time
Funny how the so called experts are changing their statements every couple of weeks and predict the total oposite of their forecasts of yesterday... Can you please tell me the numbers of the lottery next weekend?
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Rents should and wil fall...how much though?
Posted by Mohammad Dubai at 13:21 UAE time
Well, it dosnt need a genuis to predict that rents will continue to fal at least for the next quarter. The real question is: how much more? and till when?
ANOTHER THROUGHT IS:
as of today, im looking to relocate and Ican see 15-30% redcution on rents on those highly in demand places (jumaraih, etc.), certinly not enough to lure people to dump their disposable incom into this; given the unprecendented/unjustified rent figures that last year..
Verdict: guys like me and others, let those buildings/villas/ rotten till Sepember, and we shall reap he benefits
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rents and prices
Posted by paul at 12:03 UAE time
50% of the people in Dubai were employed in construction (according to the UAE census a couple of years ago).
For those thinking there will be some kind of recovery soon... what exactly do you think is going to replace all those people? Why would rents or house prices increase if demand continues to fall?
The longer it goes on, the more empty property there is, and the less reason there is to ever build more. So residential construction is pretty much dead for good. No one surely is going to start building more towers when you have hundreds of them already built which are empty.
Dubai better find something else to replace the 50% of its economy that has disintegrated forever. That is going to be tough in a global recession.
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Demand and supply
Posted by VICTOR at 11:14 UAE time
Demand and supply dictate the market in an any open economy and Dubai can be no exception. However Dubai made an exception by making housing unaffordable to common man who ran from pillar to post to find an accommodation and some sleeping in their cars or back of a truck. This is indeed diplorable. Rent control act should have come from the very first year and not at a time when rents rose sky high. With thouands of apartments/villas coming into the market there can only be one direction rents can go. South. I am a lover of Dubai and see the good old days coming back. (Remember Gusais, Al Shaab, Satwa, Karama ?).
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Dubai rents to keep falling in Q3 - Landmark
Posted by Madhulal Bhatia at 10:49 UAE time
It is good sign that rents are coming down. But we observe the fall only where expatriates have purchased properties. Since they have to pay either mortgage or they would like to compromise with downward trend. But we do not see any reduction in Bur Dubai and Jumeirah areas thought there are many flats and villas are for to let. We have to accept one thing that there is definite change and next year onwards, we shall see the downward trends in all the areas. The rents have gone up unpropotionately and this is good sign. Real Estate markets require some cooling period and they will definitely go up once the authorities try to implement certain boosting measures. Two years back the scenarios was different than what it is today. At the point of time, nobdy was ready to accept the realities that bubble will burst. Now the prices have come down and people still want them to go further down. This is human psychology but we have to be positive then to have negative attitude. Let us hope for the best and good luck to everybody.
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