Off-plan sales, new mortgage offers, new investment options: 2018 is expected to become a year of innovations for the Dubai property market. Read more on the most interesting of them.
Changes we experienced over the last year have paved the way for Dubai real estate market maturing in 2018. In 2017, the first mid-income affordable villa/town house community was introduced bringing about 1,800 new units to the market.
The average starting sales price for that properties was AED1.6 million and rents started from AED130,000 for the most affordable unit. In 2017, 70 per cent of total real estate transactions in Dubai were off-plan. An introduction of innovative concepts of collaborative and sustainable communities with open, shared living spaces such as UNA in Town Square, also took place in 2017 to get in full bloom in 2018.
Thus, the outlook for 2018 should, probably, emphasize the following 5 common trends:
- Off-plan sales will most likely continue strong and developers will get even more creative with their payment plans and rent-to-own schemes.
- Banks might offer creative new mortgage products catering to the off-plan market, especially for end users and first-time buyers.
- More community concepts based on sustainability and affordability with new approach to shared living spaces both indoor and outdoor may also come to life.
- And finally, the most important innovation expected in 2018 is associated with new ways of investing in real estate like, for instance, crowdfunding. Crowdinvesting is where a group of individuals collectively purchase a property. Investors receive proportional legal share of the property, typically through equity in a special purpose vehicle operated by the online crowdfunding platform. The return consists of regular rental income and potential capital appreciation at the time of the sale
In the UAE, real estate crowdfunding platform, Smart Crowd, recently received approval from a Dubai authorities to establish the region’s first regulated real estate crowdfunding platform. This will enable any individual to invest and own a piece of UAE property for as little as AED5,000 and will most likely stimulate sales in the secondary market.
Crowdfunding also allows to invest in properties that are already generating returns so you can get paid while you wait for capital appreciation.
- We are also likely to see new regulations introduced regarding joint ownership in property to address these initiatives.
