It’s that time of the year again, when the New Year is behind us, and we are looking forward to a fresh start. Time for resolutions is long gone, and now, is the time for business predictions and consolidation.
In a piece of good news for the real estate sector, things seem to be looking up again after a not-so-good year in 2015. Let’s take a look at the predictions for the real estate sector for 2016!
Real estate will once again come into play as a ‘major driver for economic growth’ in Dubai. With major investments in the economy, thanks to a diversified economy, attracting foreign capital to the region, real estate is the sector to watch out for. Combined with initiative support from a politically stable government, infrastructure push and less reliance on oil, the real estate sector is looking up again. Major infrastructure support in terms of public transport, ports is spurring the growth in this sector with people interested in buying property once again.
Property correction will continue into 2016. The mid-market segment will continue to grow, the rents will stabilise and overall, the property market will be less volatile and will lead more towards stability in terms of pricing. The focus will be more on affordable housing rather than just the ‘wow’ factor and futuristic buildings, which is what Dubai is more known for. This will help the real estate market grow and even out better. With property rates having fallen up 46% in parts of Dubai in the last two years, this will mean good news for the market as such.
Return to the Normal. Finally, after abnormal price shifts and volatile swings, 2016 will see a healthy growth in price and sales globally. This will of course, have its impact on the Dubai market too. There were slowdowns in 2015, compounded with a not-so impressive growth rate. So this, correction will finally see a return to normalcy – as normal as it can get. The property prices had crashed, thanks to the housing market crash in the US triggering the recession. Now, the conditions are slowly returning to normal, so distress sales will no longer be a major player in the real estate. Prices will slowly hit the normal and things will look up once again for the sector.
The Bling factor might return once again. Dubai has been famous for the futuristic buildings and designs that take your breath away. Home to the Burj Khalifa, the Dubai real estate has always been a notch above the rest. With celebrities seeking homes in Dubai once again, the bling factor might return to the market once again.
Unaffordable rents will push people to buy more than rent it out. This is a global trend with prices for rents in some tony districts being higher than it is to actually owing your own house in another part of the town. This further push for higher rents will lead to people trying to buy their own property rather than staying on rent. This will help the economy and people, immensely. With more people keen on buying the property, thanks to higher rents, it makes more business sense to buy and own property rather than renting it out. Buying will further give a push to the real estate sector with consumers once again buying property which will in turn, attract further investment and lead to more projects coming up.
All, in all, a good verdict for the property market as far as the trends for 2016 goes.