A leading UAE property agent has said that both sales and mortgage valuations have taken big hits amid the slowdown in the real estate industry.
Ronald Hinchey, resident partner, Cluttons Dubai, revealed that company sales were at two or less a month, compared to about 15 during the peak months of July and August last year.
Mortgage valuations, which peaked at about 250 a month for around 17 mortgage providers were also down to 50 per month, Hinchey added in an interview with Arabian Property magazine.
“[Property] management has continued and commercial valuations have continued, and those two departments have kept our business going,” he said.
Hinchey added that he expects to see a drop in the price of residential rents.
“I think residential rents will need to come off their highest peaks by at least 50 percent,” he said, adding that prices would also be affected by the number of people leaving the country, which would slow demand.
However, with some contracts running for one to two years, he said the full scale of price drops would not be felt until 2011.
Hinchey also stressed the importance of affordability in Dubai’s real estate market, adding that young executives should only be paying between 20-25 percent of their salary towards rent, compared with a current figure of approximately 60 percent. Asked when he believed the market would begin to pick up, Hinchey said: “Given the fact we’re looking into a bit of a black hole at the moment – we really don’t know where the world economy is going, we really don’t know what’s happening to liquidity, we really don’t know what’s happening to demand, a lot of projects have been shelved or cancelled – for people to say everything is going to come right in the second, third or fourth quarter is just wishful thinking.”
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