UAE most appealing real estate investment country for GCC residents
The UAE has retained its number one position as the most appealing country to invest in real estate in the world for GCC residents, while Dubai is the most preferred city, according to new research.
The latest Real Estate Barometer study, conducted in partnership between YouGov and Cityscape Global, asked GCC home buyers and real estate investors where they feel most comfortable investing their money globally and 45 per cent of respondents cited the UAE, up from 42 per cent in 2016, while 63 per cent chose the UAE from among countries in the Middle East specifically.
“The research findings give us a great insight into the current market conditions and certainly help us and our exhibitors to set forecasts for upcoming real estate investment expectations. With on-site sales permitted for UAE-based projects the first time at Cityscape Global this year, we anticipate a lot of interest from investors who will be able to attend the event to capitalise on attractive price options and make informed purchasing decisions directly on the show floor,” said Tom Rhodes, Exhibition Director, Cityscape Global.
Collectively, 69 per cent of respondents chose Dubai as the ‘go to’ city for real estate investment, with 66 per cent expecting the impact of Expo 2020 Dubai to increase property buyer interest in the UAE.
The research has been revealed ahead of Cityscape Global, the annual barometer for the real estate industry in emerging markets and one of the largest, most influential property events globally, which returns to the Dubai World Trade Centre from 11 to 13 September.
More than half, 59 per cent, of respondents who intend to buy a property in the next year prefer to buy in the GCC, with the average GCC budget sitting at $717,000, compared to the average global budget of $561,000. The most highly sought-after residential property to buy is the two to three bedroom apartment; 53 per cent of respondents opted for this unit size.
“The annual Real Estate Barometer is designed to track Middle East property market sentiment to help the industry expand with its future investors in mind. The 2017 study indicates a minor decline in sales and rental property prices in the UAE but overall real estate investment sentiment for the UAE looks positive. Respondents are telling us a strong regulatory framework, good supply of residential properties at different price points and the upcoming Expo 2020 will be the key drivers of a healthy outlook for Middle East real estate,” said Kailash Nagdev, Managing Director for YouGov in the Middle East.
Within the residential property price movement, the expectation in the market is for prices to come down; 56 per cent of the survey respondents expect the sales price of properties to decrease in their country of residence, while 59 per cent expect the rental price of properties to also decrease in their country of residence.
Survey respondents in the GCC indicated the importance of location in residential properties in the study, with 43 per cent opting for close proximity to educational facilities, 42 per cent for healthcare facilities, followed by grocery stores at 35 per cent, and place of work or business at 33 per cent. UAE residents, however, particularly prefer properties close to grocery stores, at 40 per cent.
“The research tells us that 88 per cent of investors are seeking value for money, 87 per cent for good quality of housing, and 75 per cent for easy access to major roads when buying residential units, so these are all factors our exhibitors can promote and communicate to visitors at their stands this year. Additionally, we’ve seen a change of investor mind-set when it comes to the size of property sought after, shifting from one bedroom and studio apartments in 2016 to 54 per cent seeking two to three bedroom apartments shown by this year’s results. This could signal a vote of confidence from investors and homebuyers as reports point to rejuvenation in the real estate sector,” Rhodes added.
The survey also highlights that exactly half of respondents feel that affordable housing is missing from the GCC real estate market, while 31 per cent believe there is a lack of reliable brokers and 28 per cent wish for better access to data comparing existing properties. Certain macro-economic factors emerge as elements of concern for potential investors; 72 per cent cite the state of the local economy, 68 per cent highlight a lack of trust in brokers and developers, and 67 per cent show concern for the security in the market of interest.
With 35 per cent of UAE respondents aware of Dubai’s initiative of becoming the first blockchain government by 2020, the organisers of Cityscape Global are preparing to highlight the implications of blockchain in the real estate market at the Cityscape Global Conference, taking place one day before the exhibition, on Sunday 10 September at Conrad Dubai.