- Broker Directory
- My Tools
- News & Advice
- Market Trends
- Other GN Sites
Everybody seems to switch off when summer comes around in the UAE. With temperatures soaring upwards, will property prices do the same?
Many families flee from the heat back to their home countries, and with Ramadan again falling during the summer months, many business have to operate with reduced hours or with fewer staff.
So what is the knock-on effect to the UAE real estate market? Dean Darby, Project Director at FAM Properties, tell us more about how we can expect the market to react to the summer heat.
- Ramadan and the summer months have an influence on industries
Not just the freehold market, in fact, the effect of both the long, hot UAE summer and Ramadan combined affect other elements in the national economy, including the stock market.
Investments go through a period of low activity, including those into the real estate sector. There would be some interest and inquiries, but a lot less compared to the other months.
- House-hunting does get difficult in the summer
The thing is, desert summers here are already challenging in themselves as people, as much as possible, would prefer to stay indoors or spend their time out inside malls and other similar establishments.
Add to it the relatively early start of Ramadan which, of course, is something we already know as everyone has a fair idea when it will begin and end even in the coming years.
Kids are having their time off school so families would be away on holidays, with single people and couples also heading off to cooler climates. Although, of course, truly keen and serious investors would not find the weather enough of a deterrent if they know they have a great deal in their hands.
- Sometimes sellers are forced to settle with what they can get
Sellers, on the other hand, have to deal with the possibility of getting a lower volume of inquiries, and even selling their property at a lower price, that is, if they urgently wish to dispose of their property.
If, however, one can patiently wait it out till the slow season is over, and one is not in a hurry to close a deal, one can reasonably expect a better sale in the end.
- The summer 'slow season' can be an advantage to smart investors
Meticulous buyers may find that their choices have become more numerous as the market experiences an overall slowdown in activity, so this can be considered an opportunity to really get what you want as an investor or property owner.
Right now, there is a great deal of pressure to invest as early as possible as further increases in the property market may be inevitable in the immediate future.
Sellers, meanwhile, have to be prepared to haggle well with those interested in what they have on offer, as buyers may use the slow summer as a point in their interest especially if they encounter sellers urgently wishing to finish the sales deal.
Those who have the luxury of time can wait it out until the peak months begin, when both the summer and Ramadan season approach their conclusion for the year, and when they can reasonably expect more inquiries from prospective property buyers.
- The summer season may give you new ways to negotiate; the out- come should make good financial sense
All businessmen, whether selling in commercial, retail business, or in real estate, recognize the effects of the slow season on their specific markets. Hence, to get the price they want, they might have to overplay whatever perks/advantages their property offers.
This is quite normal... but then, even if a seller may be in a hurry to sell, and encounters a hard negotiator, knowing full well what one owns will keep one on track. This means that, whether you are a buyer or seller, if you've done your research on the property in question, your final decision should make the best financial sense. And it would also help if you have a realtor on hand with the knowledge, experience and connections to help you get the best deal.
Get the best deal by doing these...
• Buyers: Know the latest market trends in the property segment you wish to invest in, have a checklist of locations you are interested in and weigh the pros and cons of each, set a maximum budget you will stick to, familiarize yourself with legalities involved, and get the help of a licensed and experienced real estate advisor
• Sellers: Ensure you get an accurate valuation from a certified professional, know current trends in your market segment, prepare your property for viewing, set a minimum price you will adhere to, and get professional advice
By Dean Darby, Project Director of FAM Properties
Source: Nicholas Baker, Special to Freehold