Snapshots of the realty sector - how a young country was able to compete with global cities and make a stellar mark
By: Hussain Sajwani
While the UAE celebrates 50 years and has so many remarkable achievements to commemorate, we would be amiss if we do not acknowledge the pivotal role the UAE property market played in making the UAE, and specifically Dubai, a global investor and tourism destination.
When I founded DAMAC Properties almost 20 years ago, I never imagined the level of growth we would achieve. Today, DAMAC buildings and communities can be seen everywhere in Dubai, and the Company owes its growth to the forward-thinking and wise leadership of the UAE, which has taken instrumental steps to ensure that the UAE is investor friendly.
When things became tough with the economic turndown due to Covid-19, many people were pessimistic. How can a country where tourism and foreign investment play such an integral role survive global lockdowns and travel restrictions?
But here we are, in the fourth quarter of 2021, and Dubai is well and truly back to life. Real estate transactions in Dubai crossed the year-to-date figure of Dh100 billion mark in September due to the growth in monthly sales transactions, and their values leading up to Expo 2020 has been phenomenal, far surpassing the expectations of property market analysts.
But to understand this incredible turnaround, one must go back in history to see how we got here.
I believe that Dubai’s property market truly launched in 2002, with the decree of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, which granted non-nationals (which accounted for 75% of the population at the time) freehold rights to own property.
Within the past two decades, the real estate sector has evolved into a vibrant market, able to compete with global cities around the world. During this period, there have been high highs and, naturally, some very challenging lows.
From 2002 to 2008, Dubai became one of the world’s fastest growing cities and property prices almost quadrupled. The passing of foreign property ownership laws also contributed to a massive injection of foreign money in Dubai’s property market.
Then came the global financial crisis of 2008 which “burst the UAE property bubble”. Things looked grim. However, the way the government responded is why we are still in a leading global position today.
At the time, the crash had some very serious effects, but this resulted in a more mature real estate market with better regulations and legal frameworks in place.
The establishment of RERA (Real Estate Regulatory Agency) in 2007 and important legislation passed including consumer protection laws have all helped regulate and stabilise the market in the past decade.
I believe these important achievements laid the groundwork which restored consumer confidence in the market and contributed to the uptick in end users.
This is no easy feat, and we must remember that that most mature property markets in the world, like London and New York, took hundreds of years to grow organically.
Therefore, credit must be given to this great nation, which has given our young country the ability to compete with such established global cities.
-Hussain Sajwani is the founder of DAMAC Properties
This article appeared in a special hardback edition published by Khaleej Times highlighting the achievements of the UAE on the occasion of its 50th Golden Jubilee.