Palm Jumeirah Property Sales 2016

'The Palm Jumeirah is an artificial archipelago in United Arab Emirates, created using land reclamation by Nakheel, a company owned by the Dubai government, and designed and developed by Helman Hurley Charvat Peacock/Architects'



January was a reasonable start to the year at Edwards and Towers with quite a few sales being confirmed.
With all the financial and local turmoil dominating the news at the moment we are definitely hitting some head winds but the early signs are that the Dubai real estate market still has a strong pulse.

The Head Winds

1. Oil Prices
2. Russian Rouble
3. Foreign Exchange rates
4. Slowing Chinese economy

The Dubai economy is heavily dependent on Tourism dollars and all of the above 'head winds' effect the success of our hospitality industry and ultimately the amount of visitors we receive.

The Oil price is currently around 30 dollars a barrel which puts all levels of the oil industry under pressure and without doubt we will see financial cuts at all the oil and gas companies. This will have an impact on the high end rental market in Dubai ( including the Palm Jumeirah ) where previously the Oil employees were renting expensive properties such as Garden Homes and Tiara apartments on the Palm Jumeirah. This demand has reduced considerably and the question we are all asking is how long before the the Oil prices stabilise?

The Russian Rouble is also having a huge impact on the Dubai economy. I was listening to a news brief last week that said on average a Russian tourist spends 3 times more retail spend than a Chinese tourist. We are currently experiencing a drought when it comes to welcoming Boris and Olga to our shores as their exchange rate makes Dubai 3 times more expensive than it was 3 years ago. This reduces the retail spend, the hotel spend, and more importantly to us the Real Estate spend. We have seen this first hand with very few Russian sales being seen on the Palm Jumeirah. As a side note I would estimate that the Russians accounted for about 35% of our sales in 2014. Russians love a sea view and Palm Jumeirah villas and apartments were perfect for our CIS friends.

The current strength of the dollar is impacting the local economy at every level. With our currency pegged to the dollar it's current strength makes it very expensive for most tourists or investors to even consider spending here let alone buy into real estate. In the last 3 months the dollar strength has made anybody from the UK see an increase in house prices of over 15% if they were to pay for a property from overseas funds. So we have the UK and the Russians priced out of the property market at this current time. A Palm Jumeirah Garden Home has become about GBP 200,000 more expensive over the last few months for those people buying with funds from overseas.

Finally, we have to factor in the Chinese effect to our local markets as the Chinese have been a big contributor, one way or the other, to the UAE economy. The Chinese have never warmed to the Palm as a place to live and it is probably fair to say that they have been bigger renters than buyers in the Dubai property market. The problem we are facing is more macro than micro as the Chinese economy seems to be stalling which will have a bigger impact on oil prices and also retail spend here in the Emirates.

These head winds alone are enough to make the serious investors of Dubai real estate think twice at the moment and coupled with stringent mortgage regulations it is obvious why the market has slowed over the past 6 months.
With all this in mind it is interesting to see that the rental market has remained pretty solid and as a consequence the yields are now looking very attractive. Investors have noticed this and even in the head winds are making moves for well priced property that gives a good yield.

The Palm Jumeirah is now a real estate market that offers attractive yields from properties that are scarce, well located and in a built environment that is improving with developments such as the Mall and new hotels well under construction.

To discuss property matters on Palm Jumeirah contact the author, Mark Towers.

New dedicated Website for Palm Jumeirah property

Following the success of our www.dubaipalmrentals.com site which allows tenants and landlords to find each other more easily we have now launched the equivalent site for Palm Jumeirah sales.

www.dubaipalmsales.com is 100% dedicated to offering only Palm Jumeirah property that is for sale.
It is the perfect platform for all owners to advertise their property for free and reach an audience that is looking for palm jumeirah apartments , palm jumeirah villas, and palm jumeirah plots of land.

The website is very user friendly and we hope you will enjoy looking for Palm Jumeirah property through this new channel.

Whether you are looking for Garden Homes, Signature Villas or plots of land on the Palm Island in Dubai you are sure to find what you are looking for.

Edwards and Towers specializes in Palm Jumeirah and has a convenient office for all our customers to drop into. We are located at Shoreline building 10.

Bookmark the new site and track Palm Jumeirah property throughout 2016.