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My first visit to Dubai was in the mid-1970s and I came to live in the emirate in 1980 as a young bride who had never called anywhere home other than Hertfordshire, England. At that time the property market was a simple case of GCC national landlords with international tenants.
The geographical spread of residential property was also a far cry from what we see today, covering just a few neighbourhoods. Hamriya near the Sharjah border was home to Emirati families; Maktoum Street, the Deira side of the Dubai creek and Al Rigga Street were populated by Arab expatriates; Karama and Bur Dubai were the neighbourhoods of choice for Asian families; Jumeirah was made up of predominantly European nationalities; and Mirdif was deemed a new area.
My first exposure to the Dubai property market was when I began looking for a home to rent for my husband Russell and myself. I looked at Al Huma Real Estate's single-storey villas in Jumeirah. They had basic units with mainly window air conditioning and a lot of cockroaches! In those days, when a property was vacated, no maintenance was done until a new tenant was found.
Fortunately for us, the four-bedroom villa community by Safa Park 4 had just been completed (these have now been replaced by the Wasl Development project), as were the Coastal Trading-owned group of 12 situated almost opposite.
The cost of landscaping the Safa Park villas would have been too high for our budget, so we settled on the Coastal Trading villas. Although accessible only by a sand track and with resident camels in the garden next door, the newly built villas had central air conditioning and we could see the sea from our front door.
As luck would have it, there was a job advertised with Cluttons that came with a car. I applied and became the ''villa lady''. We were based in the iconic HSBC building in Deira's Al Nasr Square, which was one of the city's first purpose-built office towers. Shortly afterwards I moved to the property management section and took over running Mansour Tower in Al Nasr Square.
The early part of the decade was blighted by the Iran-Iraq War, but by the late 1980s Dubai's population was expanding significantly and so was the property business.
Although the Dubai World Trade Centre and ARBIFT Towers had already been constructed, up until then most offices operated out of apartment buildings. In 1990-91 purpose built office towers were built by professional developers, which were the catalyst for the introduction of well-designed commercial premises and locations in Dubai.
It was also at this time that Deira City Centre, The Centre in Muraqqabat, Wafi Mall and Hamarain Centre were built, marking the first wave of new retail destinations since the opening of the city's first mall, Al Ghurair Centre, in 1981.
But the start of the '90s also came with its own challenges, namely Iraq's invasion of Kuwait, which had a negative impact on the leasing of retail premises as a number of people left the country. We had leased all the retail premises at Wafi Mall, but as soon as the invasion happened 24 of the 68 tenants had to withdraw, either because their bank finance had been rescinded or the operators felt the challenge would be too great.
But the regional ups and downs generally resulted in an upsurge in business in Dubai and a relative growth in the population.
When the Palm Jumeirah was offered for sale to nationals of countries other than those in the GCC, the focus on the potential lifestyle and economic benefits to investors were recognized and the response was unprecedented and far surpassed expectations.
The initial pricing residential requirements and first feasibility studies for the Palm Jumeirah were based on the demographics of the UAE and other GCC countries. A cap had to be put on the number of units purchasers could buy, and people bought a project where the land was still under development.
The extraordinary vision and the mindset of those who made the vision a reality is a true example of what the people who live and work in Dubai can do.
Elaine Jones is the Director of Hadley Gates Real Estate Consultancy and a fellow of the Royal Institution of Chartered Surveyors. Jones founded Asteco in 1985.
When Better Homes launched, the Dubai real estate market was really about rentals and property management, as foreigners were not permitted to own freehold property. We had no way of knowing what the market was to become. I remember someone in the construction industry telling me in the early 1990s that all the development was done—Dubai was now finished and it was just a matter of maintaining the existing stock.
When we started, we had nothing like the broad scope of nationalities that we have now and there was very little regulation. There was no such thing as the Real Estate Regulatory Agency (Rera). There was a rental board, but it was hard for it to keep up with the demands of Dubai's growing population.
Having started Better Homes in 1986, it was at least five years before I really felt the business might be a success. Each time the phone did not ring I really thought it would not ring again. Things began to change slowly by 1992. We received plenty of referrals and we became known as the go-to agency for expats looking for homes. Freehold for expats was announced in early 2000 and by 2002 the sales market began to take off, changing everything.
It is difficult to compare the business in those days with how it is today because it was so different. Today, we will have between 3,000 and 4,000 properties listed at any one time, including sales and rentals, residential and commercial. In contrast, I cannot really say how many properties we had at the start because we did not have a list, we just knew what we had available. The internet has changed that — properties will be listed on bhomes.com and clients expect to search there rather than wait for information from a consultant.
When freehold and off-plan sales started, some of the first freehold villas built were in The Meadows and I wondered why people would want to buy them, given their distance from the city and the fact that they were worth Dh1.2 million each—very few people had that kind of money. But as Dubai grew, people who did invest in them have mostly done extremely well.
The high point of Better Homes for me so far would be from 2005-07, as we invested a lot of money back into the business to create new departments (human resource, customer care and data management) and enhance customer service. It was at that time that we opened a network of branches across the city. We were the first real estate agency in Dubai to open branches in retail locations, allowing us to bring our services directly to the neighbourhoods where our clients want to live. That continues to be our strategy today.
It was a wonderful time being part of a business that transformed and grew along with the city, from a small enterprise to a larger organization with the ability to focus on quality customer service. We would not have been able to do that had we not had the boom.
The crash in 2008 was obviously a low point. However, Better Homes was started in the aftermath of the 1980s Kuwaiti stock market crash, resulting in many people being made redundant and leaving Dubai. We started during a low point, so we are no strangers to the need to adapt.
A lot has changed since then. Increased regulation and the introduction in 2007 of escrow accounts are factors making Dubai a more transparent real estate market.
As for the future, I think the continued investment in infrastructure and the outstanding leadership are the reasons Dubai will continue to thrive. It has been an incredible journey for nearly 30 years watching the city grow, and the Better Homes brand developing and diversifying along with it. Now that Better Homes is part of the fabric of Dubai, I am just as excited today about the possibilities for its future as I was in 1986.
Linda Mahoney came to the UAE in 1981 and founded Better Homes in 1986. She is the company Chairman
When I first came to Dubai in 1981, non-GCC foreigners could not own property and there were no managed villa compounds for letting to individual tenants. There were only villa developments for corporate tenants. These villas were constructed by the local business sponsors of the companies.
Very much in evidence, however, was the amazing vision of the late His Highness Shaikh Rashid Bin Saeed Al Maktoum, then Ruler of Dubai. Shaikh Rashid developed Jebel Ali Free Zone and Dubai World Trade Centre. Port Rashid and Dubai Dry Docks were also under development.
Cluttons opened its first Middle East office in Dubai in 1975. Other general practice firms of chartered surveyors followed around 30 years later from 2000 onwards, as Dubai's property industry began to flourish.
A major boost to the economy was the formation of Emirates Airline in 1985. The invasion of Kuwait by Iraq in August 1990 saw Dubai's property market being put on hold for nine months, with almost no transaction recorded at the Dubai Land Department. It also saw the city flooded with refugees seeking short-term leases, albeit at inflated prices.
The invasion of Iraq in 2003 proved not so disruptive and the scene became set for global foreign property ownership in Dubai, the first in the GCC.
The late His Highness Shaikh Zayed Al Nahyan, the then UAE President, was never a supporter of foreign property ownership, although property legal matters have always been under the jurisdiction of each emirate since the UAE's formation in 1971.
Prior to passing Global Foreign Ownership laws in Dubai in 2006-07, the contractual purchase of property was tacitly permitted by Dubai authorities, pending legal implementation in specific zones. From 2003-04 many off-plan units were quickly sold, often to speculators who took a leap of faith hoping formal legal ownership was on its way.
The property crash of 2008 came as a surprise to many experts. I for one had anticipated Dubai's emerging market to follow the example of others such as Hong Kong and Singapore, which took more than ten years before a correction.
In early 2008, we appeared to be immune to the Western sub-prime bank crisis on the premise that local banks were not as exposed to sub-prime banking problems.
A major side issue at that time was the four-year deliberation by the UAE Central Bank to depeg the dirham from the US dollar to counter the UAE's high inflation. This policy attracted billions in foreign currencies into UAE bank accounts, as investors expected the dirham to rise sharply after depegging.
When the Central Bank decided not to depeg from the US dollar in mid-2008, billions of dirhams left UAE banks within weeks, possibly adding to the downturn.
Since that time, we have witnessed a return to growth, with selected prime locations back to peak levels.
Ron Hinchey is Head of Professional Services in Dubai at Cluttons. He has lived permanently in Dubai since 1987, when he became a founding member of the Dubai Property Group
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Source: Property Weekly