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Investors are piling back in for Dubai's off-plan launches... or, more precisely, for two recent ones at Dubai South. On October 1, well over 300 homes were sold as part of the first release at The Pulse, a project directly from the master-developer and which followed an earlier sell-out — of 300 units — from Emaar South, its joint venture with Emaar Properties.
Two days and 600 plus units. In a real estate market where investors are still extremely cagey about committing to luxury purchases, end-users are not showing any such inhibitions. Clearly, the prices had a major say in dictating the level of demand.
The studios at The Pulse had launch prices of Dh280,000, a one-bedroom for Dh480,000, Dh720,000 for a two-bed and Dh1.02 million for a three-bed. The homes within Pulse's Boulevard precinct had tags of Dh550,000 for a one-bed, Dh820,000 for a two-bed and Dh1.03 million for a three-bed. The units are to be ready in 2019.
The Emaar South release had two-bedrooms at Dh700,000.
Prices, according to sources, on both were in the range of Dh700-Dh800 a square foot.
''There's a ''resetting'' of price levels at Dubai's emerging master-developments and The Pulse entry points represent the new benchmark at the lower end,'' said an analyst. ''The buyers' market — at least the budget-conscious end-user part of it — was just waiting for developers to come up with something that could meet their expectations. The two recent Dubai South launches have met that expectation.''
Now it is up to Dubai's private developers to join in. There is no shortage of available land in the residential district of Dubai South. To date, it is only MAG among private developers to have announced a residential project there. (On the commercial side, quite a few hotel project have already been announced.) But any developer will have to contend with Dubai South's own future releases, either on its own or via the Emaar joint venture. (Apart from The Pulse, the master-developer is also directly handling The Village project.) A second set of homes at The Pulse is likely to be released within weeks. According to Ahmad Al Ansari, Acting CEO of Dubai South, ''This unpreceded market response is testimony to our superior quality product, which is by far the best product in the mid-segment market.
''Our competitive pricing and attractive payment plans — of only 5 per cent down payment and a 30-70 ratio, with 70 per cent payable on completion — is a great factor in ensuring the success.
''Based on the success of the first release we are contemplating releasing more units before the end of the year.''
It is quite likely that private developers will hold off their own launches until the master-developer goes through with its second. ''By then private operators will have a better understanding on what sort of prices generate the best interest from the market,'' said an industry source. ''They will also have time to see whether the master-developer might have a mark-up on the price they had on the first release.''
It will also be interesting what the first Pulse homes will fare in the secondary market. Will the current crop of owners of The Pulse and Emaar South units hold on until the market gets back into full recovery mode? Any price surge in the secondary market will have private developers want to get into the act at the earliest.
Dubai realty is surely heading South... and this southern direction has an upbeat note to it.
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Source: Manoj Nair, Associate Editor, gulfnews.com