Damac sees ‘marked improvement’ in its July sales

DamacImage Credit: Zarina Fernandes/Gulf News Archives

Dubai: Damac Properties has witnessed marked improvement in sales in July even as it expects the real estate market to “mature with price stabilisation” in 2015, the company’s chairman said on Wednesday.

Damac Properties’ net profit for the quarter to June tripled to reach Dh1.41 billion from Dh461 million in the same period last year.

“We have already seen a marked improvement in the first trading month post these results whereby in the month of July we have seen strong growth in booked sales over the traditionally quieter June summer month,” Hussain Sajwani, chairman of Damac said in a statement.

“The Dubai real estate market has continued to mature with price stabilisation in 2015. This is a welcome and natural progression for any developing market which ensures long-term sustainability,” Sajwani added.

Sajwani said it has instituted a brand that is a firmly positioned in the luxury sector and he believes this to be a powerful differentiator from its competitors.

“We strongly believe that our sales and marketing initiatives and financial strength will help us further distinguish ourselves during this period in the cycle,” he added.

Off plan sales

“The value of the off plan sales [of both Damac and Emaar], which was strong, indicates a better outlook for the emirates real estate sector,” Tariq Qaqish, managing director at Al Mal Capital, added: “the whole sector has changed since central bank came up with rules to curb speculation activity.”

Dubai has already doubled its fees on property transactions to 4 per cent to curb flipping. On the federal level, the central bank also introduced ceilings on the mortgages which banks can offer to home buyers.

“Investors should look at investment in real estate as a medium to long-term investments, and short-term corrections shouldn’t worry the about the expectations of a short-term correction,” Qaqish said.

Prices to stabilise:

“We do expect prices to continue to stabilise through 2015 as we operate in a now mature real estate market. This stabilisation is the natural

progression for any developing market which ensures long-term sustainability,” Sajwani said.

Dubai is growing faster than most predictions, underpinned by 13 per cent of the Dh41 billion deficit-free budget allocated to infrastructure spending in 2015. Tourism numbers continue to break records, with more than 20 million visitors expected through Dubai airports in June, July and August, and the GDP target of 4.5 per cent is set to outperform the global economy.

“Looking further out, continued economic and demographic growth, together with ambitious infrastructure spend and global world class events, should support the market through 2020,” he added.

Source: Siddesh Suresh Mayenkar, Staff Reporter, gulfnews.com


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