Low property prices and flat demand will not affect sales of high quality housing in Dubai, the chairman and CEO of Dubai developer Meydan Group insisted this week.
Saeed Al Tayer sought to allay concerns over Dubai’s softening real estate market, which has been hit by the strong dollar and weakening demand from investors.
Average residential property prices fell by 10 percent last year, according to Deloitte, and are expected to drop further this year.
Real estate consultancy JLL said last month that local prices would fall by between 8 and 10 percent in 2016, with rents falling by a more gradual 3 percent.
The figures have prompted concern in the market, but Al Tayer told Arabian Business that such fears were based on a “misconception” that pipeline schemes would be hampered.
“People have a misconception of the market right now,” he said. “Look, if we go back to 2009, 2008, 2006 even, and look at a graph, we will see that Dubai real estate is a cyclical market like any other.
“When it’s cyclical, I think intelligent people take advantage of that – a smart buyer will buy when it’s at the level when it’s most competitive.
“And see, in this market, there is consistent growth, there is always a consistent appreciation, and if people think it’s soft in one location, it may not be in other parts of Dubai.”
Al Tayer said certain zones “will always maintain a consistent level of leasing or buying”, and pointed to the Sheikh Zayed Road, Dubai International Financial Centre (DIFC) and Jumeirah as examples of areas where investor demand has remained high.
He also claimed that good quality, “unique” real estate products will always be in demand.
“[Investors] are striving to have a good standard,” he stated. “So, if we are introducing a new product, at a high scale and level, we are providing an additional option.
[The scheme] could be priced at the top of the market or the bottom but we [will make a return] because we are producing something that is not already available.”
Al Tayer was speaking to Arabian Business at the launch of the third phase of the $10 billion Mohammed Bin Rashid Al Maktoum City – District One project by Meydan Sobha, a joint venture between Meydan Group and Sobha Group.
The third phase comprises 217 four-, five- and six-bedroom freehold villas and is expected to be completed by early 2019. The first phase of the scheme is on track to complete by mid-2016, Al Tayer said, and the second phase by mid-2017.
Villas range in size from 6,200 sq ft to 11,200 sq ft, and prices start from $4.2 million (AED15.5m) and rise to around $6.9 million (AED25.5m).
Larger ‘mansion’ villas are being sold for in excess of $25 million (AED90m) – making them some of the most expensive in Dubai.
The scheme also features a cycle path, green landscaping and seven kilometre ‘Crystal Lagoon’ with manmade beach.
Al Tayer admitted that the project has been subject to “various changes and improvements” since the masterplan was first developed in 2007, but “it is still a scheme that is second to none”.
“[When the market dropped] we knew we had to bring something unique into this scheme and sacrifice some density, so made it greener and more spacious.
“We also added the Meydan One shopping mall, so you have the lifestyle, tourist attraction, entertainment and leisure all rolled into one.
“We think we have created a very desirable project – this magnitude and quality of villas while also thinking about the commercial element.”For all the latest real estate news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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