Trade in Dubai property credit notes continues to decline.An earlier roaring trade in credit notes, issued to buyers in lieu of a profusion of stalled property projects in Dubai in the United Arab Emirates United Arab Emirates, federation of sheikhdoms (2005 est. pop. 2,563,000), c.30,000 sq mi (77,700 sq km), SE Arabia, on the Persian Gulf and the Gulf of Oman. , has virtually come to a halt
according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. estate agencies in the city state. Discounts offered to potential buyers have fallen dramatically, in some instances by as much as 40 per cent, making it much
less worthwhile for agents who were making a decent living from the notes two or three years earlier.
For two years ago, agents claimed that they were achieving as much as 40 to 60 per cent discount. Now these levels have dwindled, increasing risks for the buyer with
project owners displaying a distinct lack of decisive continuity. Current discount levels are running at 25, 20 and even as low as 15 per cent, which renders buying on a power
of attorney basis, a minefield of uncertainty.
DubaiAAEs property boom, which began with the announcement that foreign buyers were permitted to by freehold properties in designated zones in the emirate e·mir·ate
1. The office of an emir.
2. The nation or territory ruled by an emir.
Noun 1. emirate - the domain controlled by an emir in 2002, came to
an abrupt and painful halt at the end of 2008, as the global financial crisis began to ravage what was a predominantly off-plan market. Speculators, who had been buying then
AaeflippingAAE, in vogue parlance for reselling within weeks of purchase, a tactic which fuelled dramatic price leaps, abandoned the market in droves. Mortgage approvals all but
disappeared with a number of providers imposing maximum loan-to-value terms 50 per cent.
In many cases asking prices have slumped by between 65 and 70 per cent from their 2008 peak, particularly in the apartment segment, with villas only beginning to stabilise
against the persistent downward trend, in the first quarter of 2012. There were roughly 22, 400 residential properties of all types for sale in Dubai, on one of the main listing sites
www.propertyfinder.ae, as of the end of May.
A number of Dubai-based developers, among them Nakheel and Emaar Properties Emaar Properties (Arabic: إعمار), the Dubai-based Public Joint Stock Company and one of the world’s largest real estate companies, is listed on the Dubai Financial Market and is part of the Dow Jones Arabia Titans Index. , issued investors with credit notes against delayed and cancelled projects, rather than provide
them with a refund of advance payments in hard cash. Probably an unwelcome but wise move, faced with a prospective flight of funds from the economy of alarming
magnitude. This policy in turn created its own secondary market, with some agents earning a million Dirhams (US$ 272,480) a year in commissions out of an industry in
According to its chairman, heavily indebted Nakheel has paid out 6.6 billion Dirhams (US$1.8 billion) to settle claims over properties sold on projects brought to an indefinite
stop, either as transfers into developments that will definitely get built or in the form of credit notes only redeemable five years hence.
Finally, in July last year DubaiAAEs Real Estate Regulatory Authority Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest
administrative body, administrative unit - a unit with administrative responsibilities (RERA RERA Real Estate Regulatory Authority (Dubai, UAE)
RERA Respiratory Effort Related Arousal
RERA Redwood Empire Remodelers Association ) officially cancelled 217 property projects following a twenty four month feasibility review, leaving buyers
with even less appetite for unnecessary risk.
Copyright Andy McTiernan. All rights reserved.
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