Property investors are continuing to take a bath in Dubai as rents fell once again in August. According to a survey by the Khajeel Times and property management firm Asteco. Some of the more upmarket developments are beginning to stabilize, but with the outflux of ex-pats during the summer, falling property prices and a serious over-supply in most markets, rental prices continued their decline, and in many instances, renters are simply choosing to walk away from a new lease. The requirements in Dubai are a little different in that Islamic law does not allow for credit and renters are often required to pay a full years rent in the form of 4 post-dated cheques. This is an excerpt from the report.
If you are considering buying investment property in the UK – be warned. The latest headlines from all the major newspapers and the BBC etc, are making a great deal of the fact that average house prices in the UK rose in July by 1.7%
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Another round of losses in the third quarter shows continuing weakness in the world’s real estate markets. Although property investment in Singapore ticked up slightly in the third quarter, more bad news from major developers and property investment vehicles show continuing declines in prices, sales volumes and profitability. US luxury home builder Toll Brothers posted a Q3 loss of $472.3 million, and GPT group in Sydney, Australia posted a US$995 million loss for the first half of the year.
More on Investing in property – the big boys are starting to hurt badly
To listen to some of the headlines produced around the latest CB Richard Ellis report on Singapore’s property investment market, you could be forgiven for thinking the second coming had arrived.
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If you were starting to doubt the veracity of the press releases being issued by Dubai, the latest news should settle the matter once and for all. Back in March this year, the major developers in Dubai started canceling projects and refusing to repay deposits. Nakheel, which canceled the Trump Tower in Dubai offered – nay insisted – that investors accept a unit in other developments. This has been argued about since that time, but they are holding out against the suggestion that a unit in a different development is not the same thing – financially or otherwise. Apparently any protests have fallen on deaf ears, and Nakheel have been issuing credit notes on other canceled projects, rather than refund any money.
Dubai Properties, Sama Dubai and Tatweer have merged in an attempt to lessen the impact of the financial crisis. Dubai holding now consists of just 4 divisions instead of the previous 7 – investments, hospitality, property and business parks. there is also talk of merging Emaar properties into this new vehicle.
As per usual, getting any solid factual information about the state of the UAE’s property investment market is difficult, but a recent survey by the Royal Institution of Chartered Surveyors (RICS) points to another rise in commercial property defaults in the UAE for the second quarter.
More on Investment property in the UAE – Distressed commercial property on the rise
Thinking of investing in property in the UAE? The latest news from the region does not bode well – at least in the short term. Emirates business did a survey of real estate agents in the United Arab Emirates and discovered the consensus was “losses running into high double-digits,” for most agents. I am not quite sure what “losses in high double digits,” actually means, but it does not sound very good to me. Lost 99 dirhams?
Voit Real Estate Services’ Asset Services division, the full-service distressed asset management arm of Voit, has negotiated the sale of senior debt positions between banks and investors collateralized by three properties in Southern California. The individual considerations for each of these transactions were for undisclosed amounts between $4 million and $8 million.
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