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Affordable housing projects and mid-segment offerings within luxury developments can inject fresh confidence into a sluggish property market, experts said on the final day of the Cityscape Global exhibition in Dubai.
Interest from investors in China, Saudi Arabia and local buyers in Abu Dhabi have kept the mid and lower segment stable, developers said on Thursday.
The projects displayed during the three-day event ranged from luxury communities and hotel developments to low cost projects with easy payment options to cater to a variety of buyers and renters across the country.
"Definitely affordability is the topic of the market. It is something indispensable being taken into consideration more than ever and I think it's a big driver for the market at the moment," Mohammed BinGhatti, chief executive and head of architecture at Binghatti Holding told The National.
“It’s a matter of what can you give people that makes them feel they are walking out with something valuable. Something that is stylish that they are not shy to say they own and it is affordable.
“In general, I’m very optimistic. We have not only seen very encouraging footfall this year but also very encouraging sales. The idea is to be flexible.”
It is hoped the "more affordable" housing will reinvigorate the market. A recent report from Asteco showed villa and flat rents dropped by 2-3 per cent in Dubai and sales prices by 4 per cent reflecting a fall in residential prices year-on-year in the third quarter of 2018. Residential sales and rentals also dropped in Abu Dhabi, the report said.
Chinese investors will be a key market with a section of Binghatti’s expansive booth dedicated to China with marketing information available in Chinese.
“We have seen a lot of interest from China, they are definitely a group of people entering the market. We have also seen interest from Saudi and local interest from Abu Dhabi,” Mr BinGhatti said.
Upcoming projects from the company include Binghatti Stars in Silicon Oasis, which will be delivered at the end of the year, and Millennium Binghatti Residences, which have a view of the Dubai Canal will be delivered towards the end of next year.
The Silicon Oasis developments include studios that start from Dh450,000 to Dh650,000 for one bedrooms through to Dh1.1 million for large two bedrooms.
For sales onsite, customers are being offered a reduced booking fee, free interior design, zero commission and onsite bank mortgage approval. The projects also allow buyers to live in an existing an Binghatti development rent free until the handover is complete.
“We cater for the mid-market segment where there are a lot of individuals who earn salaries between Dh10,000 to Dh30,000 and are looking for alternatives that are more affordable than areas like Downtown Dubai,” he said.
Investors from China have also picked up mid-segment units that are part of J One, a luxury twin residential towers in the Burj Khalifa district, said Mohammed Miqdadi, general manager, of the Durar Group.
The development, with 257 flats, is due for delivery at the end of next year.
“This is a luxury project but we kept Tower A with studios, one and two-bedroom for investment. We are seeing a lot of Chinese investors for this. In the past four months, 30 per cent of our stock of Tower A apartments were sold to Chinese purchasers,” he said.
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The second Tower B includes larger units aimed at GCC investors with larger living areas, closed kitchens, maid’s rooms and laundry units. The price for sold-out studios is at Dh800,000 to Dh5 million for large four-bedroom units.
Increased government spending and efforts to attract investors with initiatives such as the 10-year residency visas is also expected to boost the property sector.
“Before most buildings were targeting high-end earners and this created a gap with medium and low income earners. The market has a lot of challenges and developers need to adjust their plans based on the market condition. Government initiatives like the 10-year visa for investors will definitely help,” Mr Miqdadi said.