Dubai property sector remains positive despite global liquidity crunch - Discovery Gardens

Dubai property sector remains positive despite global liquidity crunch - Discovery Gardens

The investment sector of Dubai, the realty market in particular is rapidly maturing as established players with long-term goals are gradually replacing speculators. Dubai, in stark contrast to the western markets has emerged as a solid base attracting foreign and regional capital, even when Europe and North America are reeling under the impact of liquidity crunch. Multinationals and foreign investors are increasingly looking eastwards; towards cash-rich economies like Abu Dhabi and Dubai to offset their non-performing assets in the west. In such a scenario, the Gowealthy Research Team analyzes price variations in the diverse freehold segments of Dubai since 2005, thereby giving you an indication of which way the market is heading in the next decade.

A housing enclave beside Sheikh Zayed Road in Dubai, Discovery Gardens is a 26 million square feet freehold development of over 26,000 units, mostly studios and one bedroom apartments of varying sizes and layouts. The project assumes significance primarily because of its location in the heart of new Dubai and economically priced properties; economical, in comparison to residential units in the neighboring master developments like Dubai Marina and Jumeirah Islands. Launched in 2004, the first buildings at Discovery Gardens were handed over to owners by the master developer, Nakheel in early 2008.

Discovery Gardens is carved into 6 themed segments - Zen, Mediterranean, Contemporary, Mogul, Mesoamerican and Cactus. The first phase includes 245 buildings, more than 18,900 residential apartments and 200 retail shops in the Zen cluster. Close to Ibn Battuta Mall, Dubai Media and Internet Cities as well as Dubai Marina, Discovery Gardens provides some of the best value accommodation in Dubai. This makes the properties most attractive to those in search of quality yet affordable housing in Dubai.

Studio prices in 2005, just a year after the project was launched in 2004, stood at USD 1730 per square meter and now they average USD 4373 per square meter, which amounts to a jump of USD 2643 per square meter in 4 years. Similarly, for 1 bedroom apartments, the average pricing was USD 1724 per square meter in 2005 and in 2008 it stands at USD 3801 per square meter. Our research reveals that prices have risen appreciably this year, especially after the delivery of the first batch of apartments in February. Demand for reasonably priced properties is on the rise in Dubai, especially in those areas that are well-connected to prominent commercial centers like TECOM, Dubai Knowledge Village, Dubai Media and Internet Cities, Jebel Ali Free Zone and Business Bay.

Contrary to reports of an early market collapse we foresee robust activity in the real estate sector and expect the trend of rising property prices in the UAE to continue for the next 3-4 years at least. This will be quite evident as the development of Dubai and Abu Dhabi shifts into high gear in the next decade.

(Facts compiled by Gowealthy Research Team; sources include in-house data, information from developers and newspaper classifieds)

Per Capita Income of Abu Dhabi second highest in the world

Per capita income of Abu Dhabi is USD 76,000, which is second highest in the world. With the current oil price boom, its GDP grew 18.7 per cent in 2007 to AED 487 billion while projection for current fiscal is AED 502.2 billion, growing at 14.8 per cent, according to the UAE Ministry of Economy.

Meanwhile, the UAE has been rated as the best country in the Arab World in promoting prosperity and general satisfaction of life in a report by Legatum Institute, spanning 104 states. Legatum Institute is an independent policy, advocacy and advisory think-tank. The country, which was placed 28th in the world, owes its high ranking to Dubai's diversified economy, according to the study.

As well as achieving a high overall ranking in the institute's 2008 Global Prosperity Index, the UAE performs well in individual categories. It ranks 24th in terms of per capita income at $22,698 (Dh 83,301), well above Saudi Arabia ($14,769) but just below Kuwait ($23,416). The UAE is 21st in the world in the satisfaction with life category, surpassing major economies such as Italy (22nd), Singapore (23rd), Germany (25th), Japan (30th) and Hong Kong (53rd).