Direct gov’t action called for to support property market – Real Estate – ArabianBusiness.com

Direct gov’t action called for to support property market – Real Estate – ArabianBusiness.com

RichVille, a real estate asset management firm, on Wednesday accused authorities in Dubai of not doing enough to support the faltering real estate market.The company, part of Dubai-based conglomerate Tharaa Holding, said in a report that authorities needed to take direct action to revive the market, which saw real estate prices fall four percent between September and October, according to HSBC.

The global financial crisis has hit demand for real estate in Dubai from foreign investors, which make up a large percentage of buyers, while tightening liquidity has made home financing more difficult.

RichVille blamed the downturn in the market on banks, which have tightened lending conditions in recent months despite the UAE central bank making 120 billion dirhams ($32.7 billion) available to the banking sector boost liquidity.“

The report held the banks in Dubai responsible for the inactivity of the real estate market, even though the central bank has taken measures to support the banking sector and the economy, no direct actions have been taken towards the real estate sector…”
RichVille said in a statement.RichVille said Dubai’s Real Estate Regulatory Agency (RERA) had to play a more active role in developing a rescue plan for the market.“

The report… suggested a rescue plan for RERA to play a much needed leading role that surpasses regulating and documenting, to cooperating with the master developers, government bodies, and main investors to develop a rescue plan…,” the firm said.RichVille called on master developers to delay any upcoming payments by six months to avoid default and “panic in the market”.

The Dubai government last week set up a committee to recommend ways to tackle the impact of the financial crisis on the emirate’s economy, including real estate and banks.Mohamed Ali Alabbar, chairman of Emaar Properties and of the new committee, said on Monday Dubai would pull back on its building spree in light of the financial crisis.

Property developers reassessing sales strategies

Property developers reassessing sales strategies

Dubai-based developers are putting sales of their properties on hold until the situation improves in the emirate’s real estate market, prominent developers said yesterday.”We will definitely reassess sales strategies in the light of the current market conditions. Everything is under review now and we have no new plans for the near future,” said Ali Mansour, Project Director, for Nakheel’s Palm Jebel Ali.

“There are no sales on Palm Jebel Ali happening as of now.

The only sales that happened were in the year 2003–2004,” said Mansour.Palm Jebel Ali is the second of the Palm trilogy being developed by Nakheel.

It is located right in the heart of Jebel Ali, close to the Al Maktoum International Airport and the Dubai Waterfront development. So far, Nakheel has sold 52 plots of land in the Crescent A, 504 units of waterhomes and 1,300 villas at development.According to Nakheel, Palm Jebel Ali will feature signature villas, garden villas and also a wide range of luxury apartments, town homes and penthouses.It is expected that around 300,000 people will live on the development.”Palm Jebel Ali has an advantageous location in a totally virgin area of Dubai.
By the time it is completed, the Al Maktoum International Airport would already have become operational.

Three phases of extension at the Jebel Ali Harbour would also be complete when the Palm Jebel Ali is delivered.

There will be some high-end and luxurious components at the Palm Jebel Ali, but the project will also have other components catering to various market segments,” said Mansour.Limitless, too, has not launched the sales of its Arabian Canal project. Ian Rainelan Raine,

Limitless’ Project Director for the Arabian Canal, said: “We will judge when the time is right to start selling. We have registered a huge amount of interest in the Arabian Canal project but we are not registering sales at the moment.”The Arabian Canal will be one of the longest man-made canals. The excavation of the canal will start near the Dubai Marina area and it will flow inland around the planned Al Maktoum International Airport. It will then meet the sea at the outer end of the Palm Jebel Ali.

Dubai Waterfront will be the first phase of the larger Arabian Canal effort. The developer said financing for the first stage of the project has been completed.

Policy review Rufi Real Estate, Dubai-based real estate developer, is revisiting its strategies and has deferred launch of some of its realty projects until the second quarter of 2009.”We were supposed to launch two residential towers in Meydaan and projects in The World, where we have bought three islands. But we have postponed all that for now,” Mehrooz Manzoor Rufi, Director, Rufi Real Estate, told Emirates Business.Rufi is optimistic about real estate prices picking up by the middle of 2009 in the emirate.Pre-sales take care of 40 to 50 per cent of construction cost and so the company need not look for external borrowing options, said Rufi