Usually known for the private beaches, designer interiors, rooftop swimming pools and helipads that come with them, a handful of developers are instead offering Dubai homes to meet a more modest market – ordinary people.
Builders' merchant-recently turned developer Danube was a prominent presence at Cityscape last week, showing off designs for 300 off-plan apartments in Studio City to be known as "Glitz" which it intends to start selling in November for less than Dh1 million a unit.
“We are targeting [the] mid-income segment. People who are on salaries that are between Dh25,000 to Dh40,000 a month,” said Rizwan Sajan, Danube’s founder and chairman. “When you are talking about a property that costs Dh1m you are talking about paying Dh10,000 per month. It is not big amount for a person who is earning that amount.”
As a self-made man who founded the Dubai building materials store 20 years ago and made it through the housing crash, Mr Sajan is a fitting champion for thousands of ambitious mid-level managers, often from the subcontinent, who are keen to get on Dubai’s housing ladder.
Mr Sajan says that about 70 per cent of all building materials used in Dubai have been supplied by his firm, enabling him to get hold of the same goods for cheaper – something he intends to pass on to customers.
Dubai-listed Deyaar is also re-designing stalled plans for one of its sites at the International Media Production Zone with 27 new buildings comprising 2,000 apartments and serviced apartments aimed at mid-income families.
Deyaar said that it is in the process of getting government approval for a first phase of eight buildings where apartments would be selling for less than Dh1,000 a square foot.
“Those people who make Dh15,000 to Dh35,000 a month. Those people are the middle class,” said Saeed Mohammed Al Qatami, the chief executive of Deyaar. “Those are the customers that we are looking at. That’s why we are creating this product.”
And over the border into Sharjah, the developer Al Thuriah said that it was selling one-bedroom flats starting at Dh650,000 and two-bedroom flats at Dh940,000 at two planned blocks of apartments close to the Sahara Centre in Al Nahda.
“Our project is close to Dubai but because it is in Sharjah it is much less expensive,” said the sales executive Michael Saba. “Only Arabs are able to buy in Sharjah but for those who can buy, it is very affordable and we are seeing a lot of demand.”
A number of real estate projects for low and medium-cost housing were first marketed during the previous boom in the early 2000s, especially on cheaper sites on the outskirts of the city, many of which were never built because of the global financial crisis.
Projects such as Nakheel’s International City suffered during the crash as tenants who could afford to do so upgraded to live more centrally amid complaints about security and maintenance. However, rents at International City were among the highest earlier this year as demand returned.
Yet the new launches come amid fears that housing in Dubai is once again becoming too expensive for many mid-income families to afford.
Last week the property website Dubizzle reported that home buyers and tenants in Dubai are now paying the same for a home as they would in New York with the median sales price for a one-bedroom apartments in both cities now standing at Dh1.9 million.
“At the moment Dubai doesn’t really have ‘affordable housing’ of the sort which we know in the West [subsidised housing usually intended for public servants such as teachers and nurses]. However, as prices have risen rapidly over the past year, some developers are spotting that there is a huge gap in the market for homes of a more affordable nature,” said Mario Volpi, the managing director of Prestige Real Estate.
lbarnard@thenational.ae
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