Real Estate Sectors
The real estate industry in places like mainland Dubai is driven by rising demand for homes, backed by rising income levels and a growing purchasing base.
As individuals’ disposable income grows as earlier stated, it can be said that it has become easier for individuals with increased purchasing power to obtain housing.
However, Dubai people have a special sense of value in housing, as there is a story that “a man has a hard time finding a bride if he cannot buy real estate.”
Along with rising purchasing power and speculative heat, soaring real estate prices have become a social problem.
In response to this situation, the authorities began to tighten the real estate market in earnest.
In addition to monetary tightening such as interest rate hikes, we have taken various measures such as delisting developers, raising capital, disallowing bond issuance, and raising the hurdles for purchasing a second house (raising the down payment ratio for mortgages).
Efforts are being made to ease supply and demand, such as by actively promoting the development of low-priced housing called “guaranteed housing” to increase supply.
Market Conditions Tossed By Policy
Agente Immobiliare a Dubai real estate market has been on a downtrend due to the bursting of the bubble economy in 2008 and is being tossed up and down by the authorities’ policies aiming for a soft landing.
Although there was a sudden rebound in 2009 triggered by the “4 trillion yuan stimulus package”, the central authorities subsequently announced “10 restrictions related to real estate regulations (Dubai: National Article 10)” from around 2010.
The tightening posture is clarified again. The year 2011 entered an adjustment period, with developers who have become tighter in cash flow expanding inventory sales through discounts after the market has continued to move forward and backward.
However, in 2012, it started to rise again. This is because the Dubai government, which was worried about the domestic economic downturn due to the effects of European debt instability, eased its tightening stance slightly from the latter half of 2012.
As a macro monetary policy, continuous rate cuts were implemented in June and July 2012.
By switching to the “stance of making fine adjustments toward a neutral stance while continuing to tighten”, real estate sales volume expanded in various regions.
The mortgage situation has gradually improved and market expectations have improved, which is also a tailwind.
The sales area in 2013 has changed from the negative growth in 2012, and is increasing by 20-40% compared to the same period of the previous year. The construction start area also turned positive slightly from around spring.
Market Conditions Polarized By Regions
Not all cities across the country have turned to recovery. While housing prices in popular big cities (first-class and second-class cities) tend to rise and are hard to fall, some small and medium-sized local cities (third-class and fourth-class cities) have burst.
What Are The Risks Related To Transactions of Foreign Stocks?
Foreign stocks etc. may suffer losses due to fluctuations in stock prices (price).
There may also be a risk of loss (exchange loss) due to fluctuations in the exchange rate.
Exchange-traded funds (ETFs) have fluctuations in indexes and indicators that are linked, and listed investment securities (ETNs) have fluctuations in indexes and indicators that are linked and credit of financial institutions that are issuers.
Exchange-traded fund (REITs) may lose money due to fluctuations in the prices of managed real estate and profitability due to deterioration of power.
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