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Dubai continues to outperform other property markets in the GCC, as the off-plan market comes back into focus, according to international property agency Chesterton. Moreover, leading property developers have been at the forefront of new launches in prime locations such as Downtown Dubai, Arabian Ranches, Dubai Marina and Dubai World Central.
Some of the factors attributed to the resurgence of the market include lower off-plan prices, economic stability and better liquidity in the market.
''An estimated 3,000 units were reportedly launched in the first quarter and popular off-plan projects include Mulberry Park Heights by Emaar, Atria by Deyaar, Palm Tower Residences on Palm Jumeirah and Celestia serviced apartments at Dubai World Central by Damac,'' said Robin The, Country Manager and Director of Valuations and Advisory at Chesterton Middle East and North Africa. ''In a rapidly rising housing market, buying off-plan actually enables investors and homebuyers to buy a property at a lower price, as opposed to the post-construction phase.
''A huge stock of ready properties has also impacted investment in the off-plan market, as end users now have a choice of a ready property market, which was non-existent in 2006. However, recent launches have absorbed excess liquidity from the ready-property market as off-plan prices continue to be competitive at 15-20 per cent lower than the prevailing market prices.''
Restrictions on resale and an increase in transaction fees have controlled excessive speculation in the off-plan market, where most of the launches are selling at premiums of 3-10 per cent.
''Capital appreciation is the key motivation behind off-plan property investments,'' said Teh.
Source: Property Weekly