Property

Dubai’s Damac says property sales boosted by foreign buyers

Firm’s managing director says foreign demand in first quarter of 2015 was not significantly affected by the fall of the Euro

PHOTO: Ziad El Chaar said the property market is being driven by interest from foreign buyers, based in Dubai as well as from overseas. Credit: Archives

Dubai’s Damac Properties posted robust sales in the first quarter of this year due to healthy demand from foreign investors, the firm’s managing director has said.

The developer’s sales hit AED2.8 billion ($762 million) in the first three months of 2015, according to a statement on the Dubai Financial Market website. Although a comparative figure was not available for the same period last year, the developer’s managing director told Reuters that sales were higher than those of Q4 2014.

“Q4 is usually our strongest quarter, so to be able to do more in Q1 gives us a good boost for the rest of the year,” Ziad El Chaar said.

The property market was being driven by interest from foreign buyers, based in Dubai as well as from overseas, he added.

Foreign demand was not significantly impacted by the fall of the Euro, Chaar noted. “Euro zone buyers were never major players in Dubai’s property market.”

Key drivers behind interest were Dubai’s lack of taxes on inheritance, as well as rental income and capital gains.

Last month, Damac announced a net profit of AED3.48 billion ($948 million) for the whole of 2014. The developer has delivered almost 13,000 homes as of December 31, 2014 and has over 38,000 units in the pipeline at various stages of progress and planning.

Despite several upcoming residential communities from developers vying for investor interest, house prices in Dubai are expected to weaken in 2015. Cluttons estimated that prices in January were 18% below the peak values of 2008.

“Over the past year there have been a number of new projects launched on the periphery of Dubai which have naturally been presented at a lower price than more established and completed projects. These launches have had an impact on the overall average price in Dubai,” Chaar told Reuters, clarifying that Damac, however, had not slashed any prices.

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