The head of one of Dubai’s largest real estate brokerages has dismissed recent reports claiming an oversupply of property in the emirate, saying demand is currently outstripping supply.
The reality of Dubai’s property availability does not match reports the market is oversaturated, said Allsopp & Allsopp CEO Lewis Allsopp in a statement.
Allsopp & Allsopp said its buyer registration and sales data shows many people are still buying, with February recording the highest sales volume since the company started in 2008, and a 62 percent increase in buyer registration on the same month in 2015.
Its figures showed that 52 percent of the properties it sold last month were on the market for less than two weeks.
He said many developers have either slowed down construction or delayed the launch of new projects this year due to a slowdown in the local economy and continued low oil prices.
Allsopp said that reports indicating too many developments in the Dubai pipeline were “patently false”, adding that demand is continuing “at peak levels and continued low supply”.
Allsopp also predicted this will lead to an increase in property prices, bucking the recent trend of falling prices and stagnating rental values in Dubai.
“Claims there is an oversupply of property and too many developments in the pipeline are patently false, as we are already beginning to see demand outstrip supply as the availability of listed properties for sale continues to decrease,” he said.
“Dubai’s year-on-year population growth of seven percent requires at least 75,000 new properties coming online each year. New developments becoming available is essential to support the growing population,” he added.
Allsopp said: “Under current market conditions, we’re regularly seeing desirable properties listed at an achievable price receive multiple offers from buyers. This shows the real strength of the market and has the combined effect of keeping supply tight, demand high and, as we’re starting to see, prices increasing.”
He added: “Oversupply would be the first thing to show the market is in trouble but the fact is we are facing precisely the opposite scenario – we’re actually struggling to find units for the demand. Thankfully the developers are aware of the current situation and we still have properties due to come online this year despite some projects being held up.”