Saeed Al Qatami, the CEO of one of the biggest and most renowned master-development entities ‘Deyaar’ in UAE, states investors who fall for deals that sound too good to be true have only themselves to blame for not doing their homework right. Extremely stretched and extended plans, beyond belief discounts and guarantees of secure savings are among the sales pitches developers in Dubai are exploiting to lure customers into buying a property within the emirate amidst current subdued market conditions that have persisted since the oil costs plunged in 2014.
With a plethora of discounted properties on offer not just at events like that at Cityscape, however, all year spherical, Saeed Al Qatami, CEO of Deyaar Development insists that consumers have to be wise and study a developer’s record.
Shedding some more light over the gravity of this situation, he stated further: “See, today you have to put your feet on the ground and be realistic about everything,” Al Qatami stated.
“So the first thing is: Is this going to happen? Is this reliable? You want to give your money to someone who is going to deliver”.
“If somebody is going to show me wow, amazing pictures, amazing photos, amazing payment plans, AED1.7 million discount or I don’t know what other sort of gimmicks, and at the end of the day it doesn’t get delivered, (then) I don’t blame that developer. I blame the investor who bought it.”
All these statement by Al Qatami were in reference to an SMS advert he was asked about that offered “reduced prices” that offered buyers an opportunity to “save” AED1.7 million on a three-bedroom property.
He added that exaggerated discounts or savings promises just meant that the property was “overpriced”.
“Those are marketing gimmicks that they do,” he commented.
In other tactics, one offered savings of AED400,000 on a studio – dropping the price from about AED1.33 million to AED850,000. Another provided the option pay 80 percent five years post-handover along with a five year-service fee waiver.
The Reliability of the Deal and Convenience of Location:
When asked if gimmicks and unbelievable payment plans were the sole ways out he might determine for developers to contend within the current macroeconomic climate and hard disposition conditions, he stated: “I think for the timing, yes. That’s why also the developers are coming up with different products of five years or four years post-handover, or even eight or six (years), so you will see a lot of those things just to facilitate to move their products.”
The CEO stressed that investors need to be “well educated and aware”.
“Reliability first, location as well is very important, and also the quality that developers deliver,” he advised.
“If you see that someone has (previously) delivered a very lousy (project), why would you want to go for those products? So investors need to do their homework and go to the trustworthy developers (and) put your money there”.
“Don’t go tomorrow and say ‘oh no I was fooled by this’. Don’t do this. Understand, is there infrastructure there? Is there the things that will make me live in a right, easy way? Am I going to drive another 30 minutes to reach to a supermarket?”
A year full of Roller-Coaster Rides for the Real-Estate Industry in UAE:
Mr. Al Qatami pointed out that this drop in sales is not a news out of the blue for this market.
“Definitely sales has been challenging not just this year 2018, but I think from the second half of 2016,” he said. “But Deyaar is different because we don’t have so many products. For example, 88% to 90% of our Midtown project is sold, so I can’t really ask my sales team to do more.”
Esam Hasan Saleh, Executive Director of Business Development and Sales, Jumeirah Golf Estates, added that “while prices and competitive offers are a response to market conditions, it is only one element in the evaluation process”.
“There are also other elements like delivery on time, like quality,” he said, adding that developers must compete for “the best interest of the buyer”.
Despite trying conditions, Saleh added that he felt positive about the state of Dubai’s real estate market because of the Dubai Land Department’s continued efforts towards “keeping this real estate market in the best shape that it can be”.
Earlier this week the Marwan Ahmed Bin Ghalita, CEO of the Real Estate Regulatory Agency (RERA) – the regulatory arm of Dubai Land Department – warned developers to “deliver on what they promise and maintain the trust that the market has built”.
When asked about it, he stated: “We feel very optimistic and we feel that the market is going very well. We’re confident about the real estate market of Dubai and we feel everything is ok.”
He added that the Land Department’s “correct valuation of the sites and projects” has helped instill confidence among both buyers and developers.
“They don’t issue any kind of percentage of completion before it’s really thoroughly checked out so this gives the market confidence and assurance to the end users,” he explained.
“It’s very professional (and) to the best interest of the market.”
Al Qatami added that while the competition is “intense”, developers must accept that “it’s always going to be intense”.
“When you have so many players in any market, definitely there’s competition.”
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