Dubai off-plan market: Back to first principles
Source: REIDIN , Author: Posted by BI-ME staff
Posted: Tue February 20, 2018 10:54 am

UAE. As Dubai housing stock continues to grow we have witnessed a greater demand in the off-plan market compared to ready. The below graph highlights the off-plan launches by quarter from 2013 to date.

 

However, in the last quarter of 2017 we have seen a drastic fall in launches followed by a slow start in 2018. We expect the pace of launches to continue to taper over the next few quarters especially as the flurry of incentives that developers have given has been exhausted; consequently, it is likely that focus will now start to shift on deliveries and that the pace of launches will slow down from its torrid pace in 2017.

Given the outperformance of the off-plan market in most observed communities in 2017, the amount of monies that were allocated to the ready space was less than 1/4th of the overall monies invested. Predictably, this led to a widening of the gap between off plan and ready prices (a phenomena witnessed globally).
 
We opine that mean reversion will occur as investible monies start to rotate into the ready space, to a point where the price gap reaches mean historical levels. This implies an upward trend in the secondary market.

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Photo Caption: For illustrative purposes only (File photo)

About REIDIN
Since 2007, we have been known for being the leading provider of property data and real estate information company for emerging markets. From being the first company to offer price indices enriched with hard-to-get real estate data in Turkey and UAE, we have become a global player in Data Analytics and Data Science utilizing the most advanced AI algorithms and techniques to process large amounts of our proprietary and client data.

Today we are a multidisciplinary Data & Analytics Company helping our clients make better strategic decisions, increase revenues, lower costs, and beat competition. Among our clients are government organizations, banks, insurance companies, retailers, property developers, brokers, consultants, and appraisers.

For more information, please visit www.reidin.com

About Unitas
Unitas believes in in-depth planning and discipline as a mechanism to identify and exploit market discrepancy and capitalize on diversified revenue streams. The purpose of Unitas is to manage, direct, and create wealth for our clients.

For more information, please visit www.unitasconsultancy.com

 

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