Leading figures in the UAE construction industry predict the major trends and issues that will disrupt the market in 2019
With the 10-year residency visa for expats and 100% foreign ownership policies initiated by the government in 2018, investments will become more lucrative, which is likely to have a positive impact on demand, especially in the real estate sector. This would be aided and assisted by the moderate recovery projected in oil prices as well as possible rationalisation in USD in 2019.
Government spending has increased across various sectors, which has led to increase in economic activities and has boosted the market sentiment. As Expo 2020 is right around the corner, we will see more pronounced and visible impacts on the economy, with more infrastructure projects materialising. With Expo 2020 set to welcome more than 20 million tourists, the hospitality sector at large and the mid-level hotels (three-star deluxe) segment in particular are expected to be in demand.
We see near to completion and completed projects gaining traction from the end user as well as investor community, as tighter markets would possibly force developers to delay deliveries. Developers that deliver quality product with a good delivery track record will capture increased buyer interest.
With new supply entering the market, developers need to adapt more creative approaches (incentives, extended payment plans and efficient unit designs) to retain their market share, which is in favour of the buyers. Exclusive properties with good quality, excellent locations and views will be in demand and would continue to be the preferred choice of niche clienteles and high-net-worth individuals.
With ongoing correction in rents, residents have wider choices with a tendency to move towards community living rather than stand-alone buildings, where they have better amenities and quality of living. This trend would lead to high-quality units delivered within good communities having higher occupancy and relatively stable rentals.
Overall, this seems to be the right opportunity for developers to cash in on their persistent focus on quality and on-time delivery.