• 12 Feb 2018

    Dubai realty gets Chinese boost

    UAE real estate, particularly that of Dubai, is steadily gaining interest among savvy Chinese investors. This extends to the brick-and-mortar assets, contracting industry as well as construction finance.

    The Chinese were the fourth most active real estate investors in Dubai in the first half of 2017, according to consultancy Knight Frank.

    A recent Knight Frank report rated the UAE as having the third highest potential among 67 countries to make use of China’s ‘Belt and Road Initiative’. It identified the UAE as the ‘Hub of the Belt’.

    Chinese contractors have a big presence among the top 5 contractors in the UAE. They also provide construction finance. The China State Construction and Engineering Corporation ranks as the second biggest contractor in the UAE with projects worth of almost $3 million. It has 16 ongoing projects.

    Knight Frank estimates that of the total contract value of future projects in the UAE (both projects in the design and execution phase from 2018-20), Chinese firms account for 6 per cent of total value of contracts. In Dubai, this is slightly higher at 7 per cent and from 2019 to 2020, it is expected to increase from 7 to 9 per cent.

    “There are an increasing number of Chinese buyers, however, it’s important to note that we’re not going from a low figure of Chinese investors to a high one. There has always been considerable Chinese investment in Dubai real estate, it’s just that at the moment, we’re seeing more coming in than in recent times. If you walk in to any of the major developers’ sales centres, you will see a large amount of Chinese buyers looking to make a purchase,” says Lewis Allsopp, CEO, Allsopp & Allsopp.

    “In the past two decades, more than 8,200 real estate transactions have been completed by Chinese buyers and roughly one quarter of those transactions took place in the past two years alone, bringing in more than Dh3 billion,” explains Jason Hyes, founder and CEO, LuxuryProperty.com.

    PH Real Estate estimates that it has seen a 10 to 15 per cent increase in the number of Chinese buyers approaching it.

    “Chinese buyers accounted for about 3 per cent of all sales in Dubai in 2017. They are taking a lot of construction projects and bringing in a lot of financing. They are bringing in a lot of their own people as well for these projects. As those people tend to get familiar with Dubai, they will want to buy homes for themselves. That trend is bound to grow,” forecasts Craig Plumb, head of research, JLL Mena.

    Identifying China as a sizeable target market, most Dubai developers have tie-ups with Chinese brokerages in mainland China and they spend a lot on marketing on roadshows and exhibitions in China.

    “The larger developers in tune with the needs of their Chinese clients. Most developers now have either a Mandarin-speaking department or at least have a marketing strategy geared towards attracting new Chinese buyers,” reckons Myles Bush, CEO, PH Real Estate.

    “Emaar, for example, has launched a Chinese website to market its properties and is offering special incentives to investors for Chinese New Year. The government has also launched its own initiatives to promote Dubai properties to the Chinese market. Last year, the Dubai Land Department entered into an agreement with the marketing company behind one of China’s leading property portals to promote Dubai property in China,” Hayes points out.

    There are Chinese agents stationed in Dubai as well. “We work closely with a few Chinese agents, one of whom had 20 clients fly in from China last week and who between them bought 13 properties in one week,” says Allsopp.

    With Dubai being one of the few global cities where investors can enjoy 8 to 10 per cent on their real estate returns, the Chinese are likely to continue to inwardly invest into the market.

    “Chinese buyers are smart investors and they are very aware that it’s a buyers market. The majority of Chinese clients we deal with are looking for high-performing rental returns rather than trophy assets. An example of this over the past week was when my team brought in a commercial floor for sale in DIFC that is currently returning a 9.5 per cent yield; within one day of advertising, seven Chinese buyers called us for more information,” observes Bush.

    “Chinese buyers are savvy and know what they want. In the majority of cases, they are investors and cash rich. They are looking in affordable projects, good deals, up-and-coming areas, top locations, etc. Generally, they are looking to tick the boxes of most investors, something that is popular, will provide a good return, should see good capital appreciation and offer a good exit strategy if needed,” concludes Allsopp.

  • 13 Feb 2018

    Secondary, off-plan property sales in Dubai continue at a good clip

    Contrary to the notion that sales in Dubai have slowed down in January at a noteable rate, a breakdown and analysis of total number of transactions in the secondary and off-plan market shows otherwise.

    Ready villas/townhouses
    According to Property Monitor data, the number of transactions in the secondary market has remained consistent between October 2017 to January 2018. For villas/townhouses in the secondary market, the total number of transactions between October to December ranged from 167 to 182 transactions per month, whereas in January, 164 transactions were recorded.

    For villas/townhouses in the secondary market, the top three areas generating sales volume in October 2017 were Emirates Living with 37 transactions, Arabian Ranches with 27 and Reem (Mira) with 17. Emirates Living witnessed an increase to 50 secondary market transfers while Arabian Ranches remained relatively constant with 25 transactions in January. Between November 2017 and January 2018, Emirates Living and Arabian Ranches remained the top two generating sales volume areas in the secondary market.

    In January 2018, the average sales price according to the Property Monitor Index for a villa/townhouse in Emirates Living was Dh2,387,083 for a three-bedroom, Dh3,164,500 for a four-bedroom and Dh6,785,714 for a five-bedroom. While in Arabian Ranches, the average sales price for a villa/townhouse was Dh3,212,986 for a three-bedroom, Dh3,475,000 for a four-bedroom and Dh4,293,648 for a five-bedroom.

    Between November 2017 and January 2018, Town Square overtook Reem (Mira) as the top area in sales volume due to its attractive middle-range price point. In January 2018, the average sales price for a villa/townhouse in Town Square was Dh1,612,083 for a three-bedroom and Dh1,913,750 for a four-bedroom.

    Secondary market – apartments
    Apartments in the secondary market were transacting at a much higher rate with the total number of transactions between October to December ranged from 782 to 851 transactions per month, whereas in January, 706 transactions were recorded.

    For apartments, the top three areas generating sales volume in January 2018 were Dubai Marina with 134 transactions, Dubai Sports City with 103 and International City with 92. From October to January, Dubai Marina and International City remained among the top three areas with relatively consistent numbers of transactions.

    In January 2018, the average sales price according to the Property Monitor Index for an apartment in Dubai Marina was Dh1,309,216 for a studio, Dh1,243,892 for a one-bedroom and Dh1,931,498 for a two-bedroom.

    In Dubai Sports City, the average sales price for an apartment was Dh614,464 for a studio, Dh801,172 for a one-bedroom and Dh1,252,020 for a two-bedroom.

    Interestingly, Dubai Sports City almost doubled its sales volume from 54 transfers in October to 103 transfers in January due to an influx of new supply. One of the handovers towards the end of 2017 was Elite Sports Residence 10, which generated 50 secondary transferred sales in January 2018.

    Off-plan market
    In the off-plan market, there was a slight decrease in the total sales volume for villas/townhouses between October 2017 and January 2018. However, the sales volume for apartments are in line with and consistent with that of 2017. Between October and January, the sales volume for apartments in the off-plan market have ranged from 1,650 to 1,850, except for December which had 2,169 transactions.

    The top three areas generating off-plan sales volume for apartments in January 2018 were Meydan One with 227 off-plan transactions, Business Bay with 186 and Jumeirah Village Circle with 168. All 227 off-plan transactions for Meydan One are in Azizi Riviera, with the first phase scheduled for completion in Q1 of 2019.

    In January 2018, the average sales price according to the Property Monitor Index for an apartment in Azizi Riviera is Dh519,267 for a studio, Dh855,329 for a one-bedroom and Dh1,396,306 for a two-bedroom.

    Similar to Azizi Riviera, the average sales price for an apartment in Jumeirah Village Circle is Dh622,354 for a studio, Dh823,098 for a one-bedroom and Dh1,459,577 for a two-bedroom.

    Priced slightly higher, the average sales price for an apartment in Business Bay is Dh1,176,036 for a studio, Dh1,339,818 for a one-bedroom and Dh1,595,294 for a two-bedroom.

  • 20 Feb 2018

    Wacky Jenga-style resort that cost £1 BILLION to build set to open its doors in Dubai

    • Work on the Royal Atlantis Resort & Residences started more than four years ago
    • The resort complex will feature a mix of living areas, with apartments starting at a whopping £1.4million
    • There will also be 795 guest rooms with on-site amenities including spas, gyms and fine dining restaurants

    Catering to the super-rich, a £1 billion resort complex is set to open its doors on the shores of the Arabian Sea in Dubai.
    Work on the Royal Atlantis Resort & Residences started more than four years ago and it is expected to welcome guests in late 2019.
    Renderings of the finished design show it looking almost like a game of Jenga, with giant blocks of apartments precariously stacked 43-storeys high.

    Work on the Royal Atlantis Resort & Residences started more than four years ago and it set to welcome guests in late 2019

    The resort complex will feature a mix of living areas, with apartments starting at a whopping £1.4million

    The resort complex will feature a mix of contemporary-styled living areas, with apartments starting at a whopping £1.4million.

    But if your bank account doesn’t quite cater to this, perhaps you can just visit the exclusive Royal Atlantis as a guest.

    As well as the 231 residences, many of which are decked out with private pools and terraces, there will be 795 luxury guest rooms and suites.

    On-site amenities will include a 24-hour concierge, spas, gyms, fine dining restaurants and a private beach club.

    There will also be around 90 swimming pools dotted around, so visitors can keep their cool in the desert heat.

    The Royal Atlantis Residences’ director, Mr Issam Galadari, said: ‘Taking resort living to new luxury heights, The Royal Atlantis Resort & Residences responds to a calling from a highly discerning, affluent, international demographic seeking a new class of offering, currently not available elsewhere in Dubai’

    On-site amenities will include a 24-hour concierge, so you can get cocktails delivered to your private pool

    The Royal Atlantis, which is located next to the famed Atlantis resort on Dubai’s man-made palm-shaped island, was masterminded as part of the emirate’s drive to build up tourism revenue.

    Commenting on the project, Royal Atlantis’ global sales agent, Maria Morris, said: ‘Our international clientele is outwardly seeking this next level of luxury in the prime market in Dubai, and The Royal Atlantis Residences delivers on all these requirements.

    ‘Now is the optimum time for property buyers to purchase in Dubai. Stabilizing property prices, infrastructure developments such as the expansion of the Dubai Metro, excellent investment opportunities and a buoyant economy are proving to be a dynamic combination.’

    The Royal Atlantis, which is located next to the famed Atlantis resort on Dubai’s man-made palm-shaped island, was masterminded as part of the emirate’s drive to build up tourism revenue

    The Royal Atlantis Residences will have views of the Arabian Sea or across the waters of The Palm towards the Dubai city skyline

    The Royal Atlantis Residences’ director, Mr Issam Galadari, echoed Morris’ words, adding: ‘Taking resort living to new luxury heights, The Royal Atlantis Resort & Residences responds to a calling from a highly discerning, affluent, international demographic seeking a new class of offering, currently not available elsewhere in Dubai.

    ‘The high-net-worth global citizen is ready for the new dawn of residential experience. The development will become the new landmark of Dubai and will support the “Dubai Plan 2021” in positioning the city as one of the best places to live in the world.’

    The Royal Atlantis Residences will have views of the Arabian Sea or across the waters of The Palm towards the Dubai city skyline.

    Dubai, part of the United Arab Emirates, has positioned itself as a destination for over-the-top luxury and opulence.

    Tourism is a major source of revenue for the emirate, which is preparing to host the World Expo in 2020.

    Dubai, part of the United Arab Emirates, has positioned itself as a destination for over-the-top luxury and opulence. Tourism is a major source of revenue for the emirate, which is preparing to host the World Expo in 2020

     

     

  • 20 Feb 2018

    When property prices are no more in square feet

    A new trend is becoming evident in the Dubai property market. Investors are placing more emphasis on the entry price of properties as opposed to the price per square foot. For instance, units that were previously advertised below Dh1,000 per sqft are being promoted as below Dh500,000 for studios or Dh1 million for one-beds to encourage takeup.

    “Yes, the entry price is becoming important for investors as a key psychological factor in a market increasingly driven by price and competing marketing announcements from a few developers engaged in a race to bottom. Price per square foot is becoming relatively less important because it requires deeper market understanding. Sadly, this is encouraging more of the lower quality stock to be built and marketed at very low price points, where the size and quality are sometimes compromised to achieve that low entry point,” says David Godchaux, CEO of Core Savills, a consultancy.

    Developers are also using this strategy to attract end-users to consider purchasing properties that are coming in at a certain price point.

    “There is a huge demand from the end-user for affordable housing, whether it is already complete or still under construction. By advertising at under Dh500,000 or Dh1 million, it is appealing to the end-user to show what you can get for under a certain milestone in price,” remarks Lewis Allsopp, CEO of Allsopp & Allsopp.

    Some developers use this strategy to hide the fact that their units are relatively smaller in size or that they have a very limited number of units available at that price point.

    “Quoting a total price rather than price per square foot is a mere marketing strategy targeting first-time home buyers with one figure, giving a clearer picture on affordability without the need to have to calculate the size multiplied by price per square foot. Savvy investors, however, look beyond the total price or price per square foot. They look for great locations, reasonable unit size, practical layouts, decent quality, fair payment plans, affordable down payments, easy mortgage payments, well-connected infrastructure, good amenities/facilities, the developer’s track record, and, of course, the potential total returns on the investment,” informs Haider Tuaima, head of real estate research at ValuStrat.

    This marketing strategy is mostly being used for smaller ticket sizes and targeted at first-time home buyers who were previously unable to afford a property in Dubai due to higher prices per unit. When it comes to mid to upscale properties, investors are still driven by the price per sqft, insist market observers.

    “The main reason is that the investor is looking at the final price as his tenant is going to pay him as per 1-bedroom, 2-bedroom, etc., in a specific location. There is no incentive for the buyer to buy a big unit and pay more but get a similar rent. This trend has advanced since 2012, when the market started moving towards more compact units with smart floor plans from some key developers, which allow the unit to be efficient with minimum space lost in corridors and other wasted areas,” observes Sanjay Chimnani, managing director, Raine & Horne Dubai.

    Short-term investors are also attracted to the entry price point rather than the cost per sqft. Such marketing strategies are also mostly offered in outer areas.

    “Short-term investors are drawn to the outer areas, and yields combined with entry price points are the key factors considered. Indeed, there may be a few good deals to be made, but today’s high return is not always a good indicator of tomorrow’s yields – on the back of the very important supply expected to be handed over in the next 3 years at low price points. In outer areas, this short-term strategy may result in a few disappointed buyers, finding themselves locked between falling rents and decreasing capital values, making their investment illiquid in the mid term,” warns Godchaux.

    Meanwhile, long-term investors are more careful, selecting developers with a strong reputation and track record, especially when buying off-plan. Location is also one of the most important factors for these investors, as long-term capital value is more likely to be retained in central areas.
    “Investors are intelligent and savvy people. They are not going to purchase something at a low yield or something with little chance of capital appreciation or something with a questionable exit strategy just because it is advertised at being under a certain price point,” explains Allsopp.

    Discerning investors in Dubai consider location, occupancy in the area, price, size, net yields and payment plans before making a purchase.

    “Investors are becoming more conscious of the full life-cycle of their investment [rather than just counting on the short-term capital appreciation followed by the exit]. Hence, they are more interested in the quality of construction, amenities, connectivity, service charges, rental potential and exit options,” says Ivana Gazivoda Vucinic, head of consulting and valuations and advisory operations, Chestertons Mena.

    Meanwhile, sellers are adapting to the new market reality. “This is evident through the constant downward correction in prices to meet the current demand and investors’ price sensitivity,” adds Vucinic.

Dubai realty gets Chinese boost

UAE real estate, particularly that of Dubai, is steadily gaining interest among savvy Chinese investors. This extends to the brick-and-mortar assets, contracting industry as well as construction finance.

The Chinese were the fourth most active real estate investors in Dubai in the first half of 2017, according to consultancy Knight Frank.

A recent Knight Frank report rated the UAE as having the third highest potential among 67 countries to make use of China’s ‘Belt and Road Initiative’. It identified the UAE as the ‘Hub of the Belt’.

Chinese contractors have a big presence among the top 5 contractors in the UAE. They also provide construction finance. The China State Construction and Engineering Corporation ranks as the second biggest contractor in the UAE with projects worth of almost $3 million. It has 16 ongoing projects.

Knight Frank estimates that of the total contract value of future projects in the UAE (both projects in the design and execution phase from 2018-20), Chinese firms account for 6 per cent of total value of contracts. In Dubai, this is slightly higher at 7 per cent and from 2019 to 2020, it is expected to increase from 7 to 9 per cent.

“There are an increasing number of Chinese buyers, however, it’s important to note that we’re not going from a low figure of Chinese investors to a high one. There has always been considerable Chinese investment in Dubai real estate, it’s just that at the moment, we’re seeing more coming in than in recent times. If you walk in to any of the major developers’ sales centres, you will see a large amount of Chinese buyers looking to make a purchase,” says Lewis Allsopp, CEO, Allsopp & Allsopp.

“In the past two decades, more than 8,200 real estate transactions have been completed by Chinese buyers and roughly one quarter of those transactions took place in the past two years alone, bringing in more than Dh3 billion,” explains Jason Hyes, founder and CEO, LuxuryProperty.com.

PH Real Estate estimates that it has seen a 10 to 15 per cent increase in the number of Chinese buyers approaching it.

“Chinese buyers accounted for about 3 per cent of all sales in Dubai in 2017. They are taking a lot of construction projects and bringing in a lot of financing. They are bringing in a lot of their own people as well for these projects. As those people tend to get familiar with Dubai, they will want to buy homes for themselves. That trend is bound to grow,” forecasts Craig Plumb, head of research, JLL Mena.

Identifying China as a sizeable target market, most Dubai developers have tie-ups with Chinese brokerages in mainland China and they spend a lot on marketing on roadshows and exhibitions in China.

“The larger developers in tune with the needs of their Chinese clients. Most developers now have either a Mandarin-speaking department or at least have a marketing strategy geared towards attracting new Chinese buyers,” reckons Myles Bush, CEO, PH Real Estate.

“Emaar, for example, has launched a Chinese website to market its properties and is offering special incentives to investors for Chinese New Year. The government has also launched its own initiatives to promote Dubai properties to the Chinese market. Last year, the Dubai Land Department entered into an agreement with the marketing company behind one of China’s leading property portals to promote Dubai property in China,” Hayes points out.

There are Chinese agents stationed in Dubai as well. “We work closely with a few Chinese agents, one of whom had 20 clients fly in from China last week and who between them bought 13 properties in one week,” says Allsopp.

With Dubai being one of the few global cities where investors can enjoy 8 to 10 per cent on their real estate returns, the Chinese are likely to continue to inwardly invest into the market.

“Chinese buyers are smart investors and they are very aware that it’s a buyers market. The majority of Chinese clients we deal with are looking for high-performing rental returns rather than trophy assets. An example of this over the past week was when my team brought in a commercial floor for sale in DIFC that is currently returning a 9.5 per cent yield; within one day of advertising, seven Chinese buyers called us for more information,” observes Bush.

“Chinese buyers are savvy and know what they want. In the majority of cases, they are investors and cash rich. They are looking in affordable projects, good deals, up-and-coming areas, top locations, etc. Generally, they are looking to tick the boxes of most investors, something that is popular, will provide a good return, should see good capital appreciation and offer a good exit strategy if needed,” concludes Allsopp.

12 Feb 2018

Secondary, off-plan property sales in Dubai continue at a good clip

Contrary to the notion that sales in Dubai have slowed down in January at a noteable rate, a breakdown and analysis of total number of transactions in the secondary and off-plan market shows otherwise.

Ready villas/townhouses
According to Property Monitor data, the number of transactions in the secondary market has remained consistent between October 2017 to January 2018. For villas/townhouses in the secondary market, the total number of transactions between October to December ranged from 167 to 182 transactions per month, whereas in January, 164 transactions were recorded.

For villas/townhouses in the secondary market, the top three areas generating sales volume in October 2017 were Emirates Living with 37 transactions, Arabian Ranches with 27 and Reem (Mira) with 17. Emirates Living witnessed an increase to 50 secondary market transfers while Arabian Ranches remained relatively constant with 25 transactions in January. Between November 2017 and January 2018, Emirates Living and Arabian Ranches remained the top two generating sales volume areas in the secondary market.

In January 2018, the average sales price according to the Property Monitor Index for a villa/townhouse in Emirates Living was Dh2,387,083 for a three-bedroom, Dh3,164,500 for a four-bedroom and Dh6,785,714 for a five-bedroom. While in Arabian Ranches, the average sales price for a villa/townhouse was Dh3,212,986 for a three-bedroom, Dh3,475,000 for a four-bedroom and Dh4,293,648 for a five-bedroom.

Between November 2017 and January 2018, Town Square overtook Reem (Mira) as the top area in sales volume due to its attractive middle-range price point. In January 2018, the average sales price for a villa/townhouse in Town Square was Dh1,612,083 for a three-bedroom and Dh1,913,750 for a four-bedroom.

Secondary market – apartments
Apartments in the secondary market were transacting at a much higher rate with the total number of transactions between October to December ranged from 782 to 851 transactions per month, whereas in January, 706 transactions were recorded.

For apartments, the top three areas generating sales volume in January 2018 were Dubai Marina with 134 transactions, Dubai Sports City with 103 and International City with 92. From October to January, Dubai Marina and International City remained among the top three areas with relatively consistent numbers of transactions.

In January 2018, the average sales price according to the Property Monitor Index for an apartment in Dubai Marina was Dh1,309,216 for a studio, Dh1,243,892 for a one-bedroom and Dh1,931,498 for a two-bedroom.

In Dubai Sports City, the average sales price for an apartment was Dh614,464 for a studio, Dh801,172 for a one-bedroom and Dh1,252,020 for a two-bedroom.

Interestingly, Dubai Sports City almost doubled its sales volume from 54 transfers in October to 103 transfers in January due to an influx of new supply. One of the handovers towards the end of 2017 was Elite Sports Residence 10, which generated 50 secondary transferred sales in January 2018.

Off-plan market
In the off-plan market, there was a slight decrease in the total sales volume for villas/townhouses between October 2017 and January 2018. However, the sales volume for apartments are in line with and consistent with that of 2017. Between October and January, the sales volume for apartments in the off-plan market have ranged from 1,650 to 1,850, except for December which had 2,169 transactions.

The top three areas generating off-plan sales volume for apartments in January 2018 were Meydan One with 227 off-plan transactions, Business Bay with 186 and Jumeirah Village Circle with 168. All 227 off-plan transactions for Meydan One are in Azizi Riviera, with the first phase scheduled for completion in Q1 of 2019.

In January 2018, the average sales price according to the Property Monitor Index for an apartment in Azizi Riviera is Dh519,267 for a studio, Dh855,329 for a one-bedroom and Dh1,396,306 for a two-bedroom.

Similar to Azizi Riviera, the average sales price for an apartment in Jumeirah Village Circle is Dh622,354 for a studio, Dh823,098 for a one-bedroom and Dh1,459,577 for a two-bedroom.

Priced slightly higher, the average sales price for an apartment in Business Bay is Dh1,176,036 for a studio, Dh1,339,818 for a one-bedroom and Dh1,595,294 for a two-bedroom.

13 Feb 2018

Wacky Jenga-style resort that cost £1 BILLION to build set to open its doors in Dubai

  • Work on the Royal Atlantis Resort & Residences started more than four years ago
  • The resort complex will feature a mix of living areas, with apartments starting at a whopping £1.4million
  • There will also be 795 guest rooms with on-site amenities including spas, gyms and fine dining restaurants

Catering to the super-rich, a £1 billion resort complex is set to open its doors on the shores of the Arabian Sea in Dubai.
Work on the Royal Atlantis Resort & Residences started more than four years ago and it is expected to welcome guests in late 2019.
Renderings of the finished design show it looking almost like a game of Jenga, with giant blocks of apartments precariously stacked 43-storeys high.

Work on the Royal Atlantis Resort & Residences started more than four years ago and it set to welcome guests in late 2019

The resort complex will feature a mix of living areas, with apartments starting at a whopping £1.4million

The resort complex will feature a mix of contemporary-styled living areas, with apartments starting at a whopping £1.4million.

But if your bank account doesn’t quite cater to this, perhaps you can just visit the exclusive Royal Atlantis as a guest.

As well as the 231 residences, many of which are decked out with private pools and terraces, there will be 795 luxury guest rooms and suites.

On-site amenities will include a 24-hour concierge, spas, gyms, fine dining restaurants and a private beach club.

There will also be around 90 swimming pools dotted around, so visitors can keep their cool in the desert heat.

The Royal Atlantis Residences’ director, Mr Issam Galadari, said: ‘Taking resort living to new luxury heights, The Royal Atlantis Resort & Residences responds to a calling from a highly discerning, affluent, international demographic seeking a new class of offering, currently not available elsewhere in Dubai’

On-site amenities will include a 24-hour concierge, so you can get cocktails delivered to your private pool

The Royal Atlantis, which is located next to the famed Atlantis resort on Dubai’s man-made palm-shaped island, was masterminded as part of the emirate’s drive to build up tourism revenue.

Commenting on the project, Royal Atlantis’ global sales agent, Maria Morris, said: ‘Our international clientele is outwardly seeking this next level of luxury in the prime market in Dubai, and The Royal Atlantis Residences delivers on all these requirements.

‘Now is the optimum time for property buyers to purchase in Dubai. Stabilizing property prices, infrastructure developments such as the expansion of the Dubai Metro, excellent investment opportunities and a buoyant economy are proving to be a dynamic combination.’

The Royal Atlantis, which is located next to the famed Atlantis resort on Dubai’s man-made palm-shaped island, was masterminded as part of the emirate’s drive to build up tourism revenue

The Royal Atlantis Residences will have views of the Arabian Sea or across the waters of The Palm towards the Dubai city skyline

The Royal Atlantis Residences’ director, Mr Issam Galadari, echoed Morris’ words, adding: ‘Taking resort living to new luxury heights, The Royal Atlantis Resort & Residences responds to a calling from a highly discerning, affluent, international demographic seeking a new class of offering, currently not available elsewhere in Dubai.

‘The high-net-worth global citizen is ready for the new dawn of residential experience. The development will become the new landmark of Dubai and will support the “Dubai Plan 2021” in positioning the city as one of the best places to live in the world.’

The Royal Atlantis Residences will have views of the Arabian Sea or across the waters of The Palm towards the Dubai city skyline.

Dubai, part of the United Arab Emirates, has positioned itself as a destination for over-the-top luxury and opulence.

Tourism is a major source of revenue for the emirate, which is preparing to host the World Expo in 2020.

Dubai, part of the United Arab Emirates, has positioned itself as a destination for over-the-top luxury and opulence. Tourism is a major source of revenue for the emirate, which is preparing to host the World Expo in 2020

 

 

20 Feb 2018

When property prices are no more in square feet

A new trend is becoming evident in the Dubai property market. Investors are placing more emphasis on the entry price of properties as opposed to the price per square foot. For instance, units that were previously advertised below Dh1,000 per sqft are being promoted as below Dh500,000 for studios or Dh1 million for one-beds to encourage takeup.

“Yes, the entry price is becoming important for investors as a key psychological factor in a market increasingly driven by price and competing marketing announcements from a few developers engaged in a race to bottom. Price per square foot is becoming relatively less important because it requires deeper market understanding. Sadly, this is encouraging more of the lower quality stock to be built and marketed at very low price points, where the size and quality are sometimes compromised to achieve that low entry point,” says David Godchaux, CEO of Core Savills, a consultancy.

Developers are also using this strategy to attract end-users to consider purchasing properties that are coming in at a certain price point.

“There is a huge demand from the end-user for affordable housing, whether it is already complete or still under construction. By advertising at under Dh500,000 or Dh1 million, it is appealing to the end-user to show what you can get for under a certain milestone in price,” remarks Lewis Allsopp, CEO of Allsopp & Allsopp.

Some developers use this strategy to hide the fact that their units are relatively smaller in size or that they have a very limited number of units available at that price point.

“Quoting a total price rather than price per square foot is a mere marketing strategy targeting first-time home buyers with one figure, giving a clearer picture on affordability without the need to have to calculate the size multiplied by price per square foot. Savvy investors, however, look beyond the total price or price per square foot. They look for great locations, reasonable unit size, practical layouts, decent quality, fair payment plans, affordable down payments, easy mortgage payments, well-connected infrastructure, good amenities/facilities, the developer’s track record, and, of course, the potential total returns on the investment,” informs Haider Tuaima, head of real estate research at ValuStrat.

This marketing strategy is mostly being used for smaller ticket sizes and targeted at first-time home buyers who were previously unable to afford a property in Dubai due to higher prices per unit. When it comes to mid to upscale properties, investors are still driven by the price per sqft, insist market observers.

“The main reason is that the investor is looking at the final price as his tenant is going to pay him as per 1-bedroom, 2-bedroom, etc., in a specific location. There is no incentive for the buyer to buy a big unit and pay more but get a similar rent. This trend has advanced since 2012, when the market started moving towards more compact units with smart floor plans from some key developers, which allow the unit to be efficient with minimum space lost in corridors and other wasted areas,” observes Sanjay Chimnani, managing director, Raine & Horne Dubai.

Short-term investors are also attracted to the entry price point rather than the cost per sqft. Such marketing strategies are also mostly offered in outer areas.

“Short-term investors are drawn to the outer areas, and yields combined with entry price points are the key factors considered. Indeed, there may be a few good deals to be made, but today’s high return is not always a good indicator of tomorrow’s yields – on the back of the very important supply expected to be handed over in the next 3 years at low price points. In outer areas, this short-term strategy may result in a few disappointed buyers, finding themselves locked between falling rents and decreasing capital values, making their investment illiquid in the mid term,” warns Godchaux.

Meanwhile, long-term investors are more careful, selecting developers with a strong reputation and track record, especially when buying off-plan. Location is also one of the most important factors for these investors, as long-term capital value is more likely to be retained in central areas.
“Investors are intelligent and savvy people. They are not going to purchase something at a low yield or something with little chance of capital appreciation or something with a questionable exit strategy just because it is advertised at being under a certain price point,” explains Allsopp.

Discerning investors in Dubai consider location, occupancy in the area, price, size, net yields and payment plans before making a purchase.

“Investors are becoming more conscious of the full life-cycle of their investment [rather than just counting on the short-term capital appreciation followed by the exit]. Hence, they are more interested in the quality of construction, amenities, connectivity, service charges, rental potential and exit options,” says Ivana Gazivoda Vucinic, head of consulting and valuations and advisory operations, Chestertons Mena.

Meanwhile, sellers are adapting to the new market reality. “This is evident through the constant downward correction in prices to meet the current demand and investors’ price sensitivity,” adds Vucinic.

20 Feb 2018

All you need to know about registering for VAT?

Dubai: According to the executive regulations on value added tax (VAT) published last week, the mandatory registration threshold is Dh375,000.

This means that anyone with a turnover of Dh375,000 or more is required to register their business for VAT, the Federal Tax Authority (FTA) and Ministry of Finance (MoF) said in the recently release regulations.

The voluntary registration threshold is Dh187,500, with companies of that size or above able to register for VAT too.
The failure of a taxable person or business to submit a registration application within the time frame specified in the tax law is liable for a Dh20,000 fine.

Also according to the executive regulations, companies are able to register as a tax group.

Through this mechanism, more than one company can register for VAT as a group, under a single common control, according to Dubai-based Jitendra Consulting Group. They say that the main benefit of group registration is to simplify the procedures and save costs through consolidated tax returns and a single VAT registration.

The group’s tax returns and payments are carried out by the member who acts as a representative of the group, the FTA has stated. All the members are jointly liable, however.

VAT rules VAT rules

VAT rules

 

6 Dec 2017

UAE’s Federal Tax Authority announces full VAT supplies list

The Federal Tax Authority (FTA) has announced the supplies that will be subject to Value Added Tax (VAT) as of January 1, 2018, revealing selected sectors that will be assigned zero-rated tax, such as education, healthcare, oil and gas, transportation and real estate.

Selected supplies in sectors such as transportation, real estate, financial services will be completely exempt from VAT, whereas certain government activities will be outside the scope of the tax system (and, therefore, not subject to tax).

These include activities that are solely carried out by the government with no competition with the private sector, activities carried out by non-profit organisations.

The UAE Cabinet is expected to issue a decision to identify the government bodies and non-profit organisations that are not subject to VAT.

The below table outlines all supplies that will be subject to the 5% Value Added Tax, as well as zero-rated supplies and exempt supplies:

VAT in education

UAE vat in all sectors

 

6 Dec 2017

Can you buy a home with Dh10,000 salary in Dubai?

There is a property for every income bracket in Dubai. The lower sales prices and attractive payment plans offered by developers in Dubai are resulting in more first-time home buyers hopping on the property bandwagon. The introduction of new innovative mortgage products by some local banks has also contributed towards this increased activity.

Even someone with a salary of Dh10,000 can climb onto the property ladder today, provided they can arrange for the up-front payment and registration charges.

home buying plan

“There are enough properties available to cater across a wide range of salary brackets. Prices and accessibility criteria for a home mortgage, traditionally the two biggest barriers for new entrants to the property market, have been lowered, thus resulting in an uptick in market activity,” says Lynnette Abad, partner and head of Property Monitor/Cavendish Maxwell.

Apartments are the achievable properties for salaries between Dh10,000 to Dh15,000.

qouate

“The average one-bedroom apartment in new residential areas such as Dubai Silicon Oasis, Liwan, etc., is worth about Dh600,000 with a down payment of Dh150,000 and Dh30,000 in registration expenses. The buyer has to pay about Dh2,200 a month. This is easily achievable for most people earning Dh15000+ a month. This is much less than their rent,” suggests Sanjay Chimnani, managing director, Raine & Horne Dubai.

This year, the top areas for affordable properties to one with a monthly salary of Dh10,000 are (in order) International City, Jumeirah Village Circle (JVC), Al Furjan and Dubai South, estimates Property Monitor, a real estate intelligence platform.

For someone with a monthly salary of Dh15,000, the top areas with affordable properties are Dubai South, JVC, Business Bay and Dubai Sports City, the consultancy adds.

However, if you are looking to buy a villa or a townhouse, it would require a monthly salary of Dh25,000. “It will fetch you a townhouse in master-planned communities such as Town Square and Reem, Mira. Some of the other top areas in this salary bracket are Dubai Marina, Business Bay and The Lagoons,” informs Abad.

The challenge for most buyers is to arrange for the down payment plus registration costs of about 30 per cent. “If this was to be reduced to 15 per cent, we would see an even greater shift to ownership in this market,” suggests Chimnani.

However, the moot question is whether a person earning Dh10,000 a month is eligible for a mortgage. Provided the customer does not have any major loans (personal, credit card and auto), s/he would be eligible for a house loan of up to 25 years, subject to age criteria which restricts payments to the age of 65.

“People earning Dh10,000 and above can apply for a mortgage. The minimum salary requirement for a mortgage is Dh10,000. However, there are only a few banks who do mortgages for clients with Dh10,000 income and, therefore, options for these clients are limited. Majority of the banks require a minimum salary of Dh15,000 and above,” says Carol Monis, head of mortgages, MortgageMe.ae, a group of mortgage brokers in Dubai.

She adds that “most of our mortgage clients are end-users who fall into an income bracket of Dh20,000 to Dh25,000”.

Dhiren Gupta, managing director, 4C Mortgage Consultancy, adds in the same vein that the average income group buying property in Dubai is around Dh25,000 to Dh35,000 and they are primarily buying mid-priced property worth of Dh1.5 million to Dh2 million.

“With such income, they can easily qualify for a loan, barring they do not have pre-existing liabilities and age limitation is not a barrier. Moreover, banks are more comfortable to funding such profiles wherein the property will be utilised for self-use,” concludes Gupta.

3 Dec 2017

Sheikh Mohammed signs VAT Executive Regulation

The Ministry of Finance, MoF, Monday announced that His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, signed the Executive Regulation for the Federal Decree-Law No. (8) of 2017 on Value Added Tax, VAT.

The Regulation defines VAT as the 5% tax imposed on the import and supply of goods and services at each stage of production and distribution, including what is a deemed supply, with the exception of specific supplies subject to the zero rate and what is exempted as specified in the Decree-Law.

The tax will go into force effective January 2018, and all business have to take all necessary measures to avoid the risk of non-registration by 1st January, 2018, which would entail fines as stipulated in Cabinet Decision No. 40 of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.

Commenting on the milestone, Younis Haji Al Khoori, Undersecretary of MoF, said, “Today’s signing of the Executive Regulation by the Vice President, Prime Minister and Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum, marks a new milestone in the application of an efficient taxation system in line with best international standards with the ultimate objective of improving performance of primary sectors and enhancing social welfare.”

The first title of the Regulation includes the definitions of terms used, while the second title deals with supply, which includes articles regulating the supply of goods and services, as well as supplies that consist of more than one component and the exceptions related to deemed supplies.

The third title of the document tackles the subject of registration, such as mandatory and voluntary registration, related parties, conditions to be met to register tax groups and appointing a representative member, deregistration, exception from registration, registration on law coming into effect and obligations to be met before deregistration.

Meanwhile, the fourth title looks into rules relating to supply, including articles on the date of supply, place of supply for goods, place of supply of services for real estate, transport services, telecommunications and electronic services, intra-GCC supplies, the market value, prices to be inclusive of tax, discounts, subsidies and vouchers.

Furthermore, title five discusses profit margins and explains how to calculate VAT based on profit margins, while title six addresses zero-rated goods and services, including telecommunications, international transportation of passengers or goods, investment grade precious metals, new and converted residential buildings, as well as healthcare, education and buildings earmarked for charity.

Title seven clarifies provisions relating to products and services exempt from value added tax, namely: the supply of certain financial services as specified in the Executive Regulation, the supply of residential (non-zero-rated) buildings either by sale or lease, the supply of bare land, and the supply of local passenger transport.

The eighth title of the Regulation then addresses accounting for tax on specific supplies and includes articles relating to supplies with more than one component, general provisions in relation to import of goods and applying the reverse charge on goods and services, as well as moving goods to implementing states and imports by non-registered persons.

In title nine, the Executive Regulation address Designated Zones in article (51), while title 10 provides further detail on calculating due tax, recovery of input tax relating to exempt supplies, input tax not recoverable, and special cases for input tax. The following titles 11 includes article (55) on apportioning input tax and article (56) on adjusting input tax after recovery, whereas title 12 addresses the capital asset scheme in article (57) and adjustments within the capital asset scheme in article (58).

Title 13 of the Regulation includes article (59) on tax invoices, article (60) on tax credit notes and article (61) on fractions of the fils. Then in title 14, the Executive Regulation discusses Tax Periods and Tax Returns, before title 15 goes into recovery of excess tax in article (65). Adding to that, title 16 tackles recovery in other cases and includes article (66) on new housing for nationals, article (67) on business visitors, article (68) on tourists and article (69) on foreign governments.

The 17th title includes article (70) on Transitional Rules, article (71) on record-keeping requirements and article (72) on keeping records of supplies made. Meanwhile, the 18th and final titles discusses closing provisions.

28 Nov 2017

Who we are

The team, at Masterkey Properties, comprises indigenous experts in renting, selling and managing commercial properties and villas in Dubai, UAE. Established in 2006, the company has over a decade of experience in tracking new property developments and estimating trends in prime market areas that help clients in meeting their requirements. We are currently selling and leasing out properties in all areas of Dubai. We strongly believe if you have a requirement for a home or office space, we will help you find it!

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