Mazaya Monthly Real Estate Report - November 2013
These two companies have managed to
achieve conditions and necessary preventive
measures that have been developed by the
Dubai Land Department to protect the current
real estate growth. It is worth mentioning here
that the surge recorded in real estate prices
in selling and leasing, has resulted from the
demand growth and from developers' desire
to sell rather than lease. The data show that
the capital value of real estate in the Burj
Khalifa, the highest and most exclusive tower
in the world, has increased by 27% and 30%
during the last period of the current year, while
villa prices have risen by more than 11% and
apartments by 15% since the beginning of this
year. The prevailing successive price rises
can push real estate development companies
towards more projects with high demand.
A report issued by Land Sterling Property
Consultants Company has shown that the
strength of real estate activity registered
with the Emirate of Dubai has gained
new impetus as a result of the renewal
of selling on the chart, which amounted
to 6000 real estate units since 2012. The
selling on chart are subject to strict laws
and regulations, which aim to protect
investors' money, so we can say here that
the total selling activity on the map, which
becomes active in the secondary markets,
has not reached the limits of danger at
the moment, as real estate development
companies are taking the necessary
precautionary measures to prevent access
to tripping trails. The companies have
increased the rate of the first payments up
to 40% within one year from the date of the
transaction completion, while final investor
has become more aware, in the light of
the improvement in investment and legal
awareness, and in the presence of more
choices and rates of demand and supply
fromwhich suitable prices can be obtained.
In the context of testing the success
of the sale of the real estate units on
the map which are subject to the laws
and legislations governing them, the
recent statistics issued by the Ministry of
Commerce and Industry in Saudi Arabia
have shown that the number of real estate
units for projects licensed to sell real estate
units on the map amounted to 16 300 real
estate units at the end of last September.
The ministry aims through its direct control
to raise the transparency level in the real
estate market, reduce the ownership
cost of real estate units, and raise the
competition level among the developers to
increase the supply of projects. The license
of the housing unit sale is reported to be
available on the website of the Ministry
of Commerce. Through the ministry's
website, it is also possible to apply for
the license of real estate unit sale in the
real estate development projects on map.
The report points out that the banking
sector and mortgage companies have
harmonised with the registered activity in
the real estate sector in greater adoption
of more flexible funding policies than the
procedures and conditions that have been
imposed on this type of financing. It can be
said that the improvement in the financing
conditions tends, in most cases, toward
granting loans for the final users, without
financing real estate projects offered by the
real estate development companies in the
regional markets, because they have not
passed over all the challenges and risks
posed by the repercussions of the crisis.
In contrast, the real estate market in the
region has become more careful and
responsive to the demand from final users,
as there are many trends towards adopting
more legislation and laws in real estate
financing, some of which have been issued
by the central banks. In the current period,
the programmes for the provision of real
estate units to applicants in all countries of
the region are getting more active, whether
to provide housing loans or real estate
grants. This should give the mechanisms of
supply and demand greater transparency
and stability on the price index, and inhibit
banditry of all manipulators at the real estate
market in all its components, if all parties
committed themselves to the frameworks and
legislation governing the real estate market.
Al Mazaya’s report also confirms that the
continuous rise of the prices of real estate
products in the regional markets will support
the trend towards increased sales on the map,
with real estate products having low prices,
particularly at the launch of these projects, and
with the buyers not forced to pay the value of
the property in full. Unfortunately, these kind
of deals are not legally guaranteed and do
not receive the appropriate financing options
if they have not undergone stringent laws.
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