Investment by Gulf Cooperation Council (GCC) nationals in Dubai’s real estate market exceeded Dh19 billion during first half of 2014, the Dubai Land Department, or DLD, announced on Tuesday.UAE nationals accounted for a major share of this investment, according to the report issued by the DLD’s Research and Real Estate Studies Department. UAE nationals accounted for transactions worth Dh12.5 billion in the city’s property sector from January 1 to July 1. The amount represents almost double the Dh6.5 billion figure invested by all other GCC nationals combined.UAE national investors made 2,513 transactions worth a total of Dh12.568 billion in the first six months of the current year to take top spot, well above all other investors in Dubai’s real estate market, said Sultan Butti bin Mejren, director-general of the DLD.
“The figure indicates the great demand from UAE nationals in investing in property in Dubai and sends out a reassuring message to all other categories of investors. In addition to strengthening confidence in the market, it provides solid foundations that will ensure its sustainability and long-term stability,” he added.
“The wise policy pursued by the government of Dubai has created incentives that are encouraging smart real estate investors from across the world. The success of this policy, as evinced through the sheer volume of investments made by GCC citizens, points to the increasing trust placed in Dubai’s property sector. This confidence will radiate to all corners of the globe and attract and foreign nationals from countries outside of the region.”
Citizens of Saudi Arabia were ranked second on the list of GCC real estate investment after making 1,121 transactions worth Dh3.371 billion in the first half of 2014. Qataris came in third with 113 transactions worth Dh1.463 billion.
Kuwaitis were listed at fourth place with 263 transactions worth Dh839 million and Omanis were in fifth spot with transactions worth Dh482 million. Bahrain citizens occupied the sixth position.
In 2013, the total value of real estate transactions in Dubai rose from Dh154 billion in 2012 to Dh236 billion in 2013.
After Emiratis, the biggest investors in the Dubai realty sector include Indians, Britons and Pakistanis, according to the DLD. In the first quarter, Indians continued to be the top foreign investors in Dubai’s real estate market with investments worth Dh5.8 billion. Britons came next with a total of Dh3 billion while Pakistani investors spent around Dh2 billion. Indian investors spent Dh8 billion in the first half of 2013 and Dh9 billion in the whole of 2012.
Property prices have been growing at a slower pace in Dubai, which has retained its status as the most “transparent” regional property market for global investors.
According to the Global Real Estate Transparency Index for 2014 released by consultancy firm JLL, Dubai was ranked 49th in the JLL findings with a composite score of 3.11, while Abu Dhabi was 53rd with 3.20.
In the first quarter, Dubai’s residential market maintained its momentum with average prices increasing 33 per cent year-on-year, with average rents improving 23 per cent. Over the remainder of the year, prices are expected to continue their upward trend but at a slower rate, JLL said.
A market intelligence report by Tasweek Real Estate Development and Marketing noted that Dubai’s real estate prices abruptly leapt by an average of 20 per cent after winning the right to host World Expo 2020.
“However, growth slowed down in the first quarter of 2014, bringing property prices to a more realistic level of a 10 per cent to 15 per cent increase. This trend will continue for the year as businesses wait for the government to announce projects related to the World Expo.”
— issacjohn@khaleejtimes.com