Dubai property regulator says 'more flexible' market is showing signs of stabilisation, with survey showing progress at most sites.
Developers keep pace on projects
Dubai // Almost three quarters of property developments in Dubai have made construction progress despite the economic slowdown, according to preliminary data from the industry's regulator. Of 552 projects, more than 72 per cent showed some construction progress, while 17 per cent were "stalled" and 11 per cent were "delayed", according to the latest data from the Dubai-based Real Estate Regulatory Agency (RERA), which is undertaking a study to map construction progress across the emirate.
"It confirms what most people believe," said Michael Atwell, the head of the regional office of the property consultancy Cushman and Wakefield. "Many projects are behind schedule, but some are moving forward." The RERA launched a review of 1,108 off-plan developments in the emirate in February to try to increase transparency and trust in the property market. It has already completed reviews of about half of the total, according to its website.
Mr Atwell said the survey was important to make the property market more accountable, but a clear definition of commencing construction was needed from the RERA before the data could truly be understood. "The question is what do the terms mean exactly," he said. "Some developers are just putting site fencing around their plot. Can that count as starting works?" Mr Atwell said the RERA should also clarify the meaning of projects described as "proceeding with a schedule approved by RERA".
Marwan bin Ghalita, the chief executive of the RERA, said he believed the market was seeing signs of stabilisation. "Developers are now more flexible with the customers about payment plans, about prices," he said. "Both parties are co-operating more together. People want to know what is going on with their project." Earlier this year, the RERA said it was in the process of cancelling 27 projects from developers who could not move forward with their projects. Since the economic slowdown began hitting the UAE last autumn, the RERA has taken a more prominent role in policing the property sector.
It now has the powers to cancel projects and to prevent developers from operating in Dubai by removing their licence to sell property. Mr bin Ghalita said in February that Dubai's housing projects could be split into four broad categories: those that would be cancelled; those that would be rescheduled; those that would be merged; and those that would be completed on time over the next two years. The survey would help the RERA decide which projects fitted into which category, he said.
Under the review, called the independent progress monitoring report, each project is rated from 0 to 5 for its construction progress, with 5 being complete. The RERA website displays a coloured arrow for the speed at which a project is moving along. A green arrow denotes the project is progressing according to schedule, while an orange arrow means the project is advancing according to a new schedule approved by the RERA.
A red arrow means it is delayed and a black symbol means the project is stalled. According to an analysis by The National, the average progress of the projects in the database is 1.37 and the largest number of projects have the orange arrow. Of the 552 projects, 27 per cent have not yet started construction. firstname.lastname@example.org