The Dubai realty players were hoping against hope that things would turn for the better in 2019 but not only are there hopes not fulfilled, on the contrary their worst nightmare are coming true.
Dubai’s landlords are struggling to sell homes
While on one hand reports indicate that rents have drastically dropped due over supply of homes in Dubai, on the other hand the real challenge for realty players has become to sell property. Property owners wanting to sell now find they are getting nowhere near their asking prices because there are brand new ready properties being offered by developers with post-handover payment schemes, Land Department fee waivers and lock-in service charges for extended terms. And if need be, developers can even get mortgages approved for the buyer. Against such incentives, individual owners planning to sell find they have limited room to manoeuvre. As a result, those who have sold their properties, have mostly done in major losses. This has been the case in all areas where new homes are being delivered in significant numbers, and applies to properties across all price and category types. This scenario has ultimately benefitted the end consumer in the rental space as now more apartments are available for lesser rents
Hotel room rates across Dubai drop despite increase in visitor numbers
The average hotel room rates across Dubai have dropped despite a surge in visitor numbers, according to a new report. The latest preliminary data released by STR analysts showed that most hoteliers across the city are still enticing guests with lower rates in a bid to fill their rooms. During the month of December, hotels were charging less, with the average daily rate dropping 4.3 per cent to Dh 758.80, while the revenue per available room fell 6.9 per cent to Dh 600.98. December or the last quarter of the year is traditionally a busy period for the tourism industry in Dubai. Last November alone saw 6.9 million passengers arriving in Dubai International. However, there hasn’t been enough guests to fill all the available rooms, which is why most hotels were not fully booked throughout the month. According to STR analysts, the problem is that there are just too many new hotels being built around the city.
Abu Dhabi rents to drop as thousands of news homes made in 2018
The costliest emirate in terms of rent and living in UAE is its capital Abu Dhabi. But things are bound to change in 2019. Pressure on rents from the rush of new homes being completed is not just a Dubai story – much the same is happening in Abu Dhabi as well. Nearly 5,000 residences were delivered in Abu Dhabi last year and about 10,000 units are expected to be ready this year – this will have a telling impact on rents. If this rate of supply in Abu Dhabi carries over the next few years, the market will remain oversupplied which could dampen any potential improvement in prices and rental levels. Residential vacancies are anticipated to increase further causing further rental declines. Bureau report – NMTV News.