Saturday, October 6, 2012

From The Expert..!

Charles Neil
Charles Neil

CEO Landmark Advisory (Research and Consultancy)
CFO Landmark Properties.

During the last few weeks, once again after the limited influx of moneys from Arab Spring Countries into Dubai (as estimated in $10 Bln), with corresponding activities in property market (around 3000 units).. Talks grow on the coming back of the golden times.. This was indirectly supported by the official campaign and planning to gear up the Emirate for Expo 2020, which in any vision requires flourished businesses and sparkling opportunities.. However, the root-causes of the 2008 bubble still uncleared, awaiting for innovative plans to utilize around Sq.Ft 200 Mln of ready RE products, or the equivalent to 100,000 units.. This is what constitutes the famous 2008 debt crisis.. As how such money cycle is huge, some had gained from both naivety and distinctions of this market; and yet aim to continue gaining.. To secure a sustainable RE market in Dubai, the Experts should speak out..!

During the last 8 years; Charles joined the top decision making circle of Real Estate.. Following; are his solid comments as shared on Linked-in

The Dubai market is running ahead of itself in my opinion. There is still a lot in the way of existing construction that has yet to come on the market without having new projects being announced. what amazes me is that people are prepared to buy off-plan after the losses so many investors incurred post 2008. all I can think is that it is the speculators at work again who ruined the market in 2007/2008 by causing the bubble, then damaged the developers by defaulting en masse, and are now all set to create another bubble. The serious investors should not allow themselves to fall prey to the hype that is going on..

The serious investors should not allow themselves to fall prey to the hype that is going on , the laws on the subject of "off-plan "while better do not still adequately protect the investor , they are one-sided in favour of the developers. it is far better for an investor to buy an existing property and start earning income from it from day -one rather than wait for 3 years for handover. The speculators hopefully will get their fingers burnt as the serious investors will stay away until they see what they are actually getting for their money..

The developers should also be wary of the speculators, they were burnt by them before and will be burnt again if they think they can rely on them to fund their obligations through to the end. One word of advice, if you are going to buy off-plan, never , never, take a mortgage, this has been a complete minefield for serious investors who have to sign in to tri-partite agreements and lose all leverage over the developer in the handover process , and end up paying off mortgages even though nothing has been delivered, and run up huge interest bills if the project is delayed. If you are going to take a mortgage it should only be for a completed unit..

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