UAE Real Estate Market Shows Early Signs Of Recovery: RICS Report
Sentiment in the UAE real estate investment market improved during the second quarter of 2012, boosted by the rising availability of funds for investments, reports RICS in its latest Global Commercial Property Survey published on 2nd of August 2012.
On the investment side, purchaser enquiries rose for the second consecutive quarter and transactions are forecast to rise in the coming months. Significantly, expectations for capital values in the UAE for the third quarter show a modest increase for the first time since 2008.
According to the RICS survey, 16% more respondents indicated that money available for investment in real estate increased during the second quarter of the year.
Meanwhile occupier demand, led by an active retail sector, continued its rise, though at a slightly slower pace. New supply coming on to the office market adds to existing stocks so that despite the recovery in demand the oversupply situation continues to impact upon rental expectations.
Elsewhere, following on from strong Q1 results, the real estate market in North America and Canada has remained buoyant in both occupier and investor markets despite the global economic slowdown. China and Hong Kong also appear to have relatively resilient occupier markets for the time being. However, once again, the survey shows a generally weaker picture across Europe, with signs of stress spreading from the periphery to other markets. Greece, Spain, Portugal, France and Italy in particular showed signs of distress during this quarter of the year, with both sentiment and activity levels suffering on the back of elevated uncertainty.
Commenting on the latest survey results, Simon Rubinsohn, RICS Chief Economist, said:
« It is encouraging that there are now some tentative signs of a turn in the real estate market in the UAE. At the moment, this is more visible in the investment market and it will take some take some time to work off the excess space that has built up in recent years. As a result, it may be premature to envisage any upturn in rent levels but after a torrid period, the indications are that that they are at least now close to stabilizing. »
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