Contribution by Dubai government to win back the lost trust of real estate buyers
Posted By Jason
The main hurdle being faced by the Dubai government to fix the deteriorating condition of Dubai real estate is the lost trust of investors or buyers. This is because investors are not getting good returns on their properties. There was a time when this confidence was so low that even the owners of the properties were not ready to take their ownership from banks.
But the potential which Dubai real estate holds has motivated Dubai government to step in to the game and take serious measures. These measures are boosting the confidence of the local real estate agents as well. Some of the steps taken by the government to win back the confidence of the investors are given below:
Attracting foreign investment
Dubai government is attracting investment from foreign countries. Especially investors from Qatar and Kuwait are very much interested to invest in Dubai real estate. Dubai is kind of a second home for Kuwaiti investors and the prices touching bottom level are attracting them to invest here for better results in future. This investment is boosting the confidence of local buyers to also invest in Dubai property.
Slashing of mortgage rates
Recently Dubai government has slashed EIBOR 0.66 points, which is now giving enough margins to the scheduled banks operating in Dubai to lend mortgage loans at lower prices than before. All the banks have reduced their individual mortgage rates to as low as 5%. The prominent players in this field are Standard Chartered and Barclays.
Constructing new residential towers
Dubai government is working on the construction of high end residential towers in major areas of Dubai. These residential towers would be among the tallest towers in Dubai and will contain all the basic and luxurious facilities and amenities. These towers will eventually pay off very good returns to the Dubai real estate and other property investors.
Blocking supply
By the end of 2010, Dubai government cancelled almost 217 real estate projects to block oversupply. Moreover, government has cancelled many other projects in 2011 which were expected to hit the market by the end of year 2012 and 2013. This will prove to be beneficial in fixing the problem of oversupply and will result in recovery of prices.
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