Nationals just 5% of buyers - Emirates24|7

Nationals just 5% of buyers

Mohammed Nimer (SUPPLIED)

 

Two out of three of all new freehold properties in the UAE are bought by foreign corporates, or individuals who live outside the country, according to a developer.

MAG Group Property Development, which is looking to grow its portfolio of property projects to more than Dh10 billion by 2012, said final owners currently account for just 30 per cent of the market and only five per cent of them are nationals.

"It is not difficult to understand why," says MAG Group Chief Executive Mohammed Nimer. "Investing in property in the UAE is seen as safe and rewarding and currently better than investing in bonds or stocks.

"In spite of numerous challenges, such as rising costs and shortage of contractors, the real estate sector in the UAE is still one of the most important investment areas in the country. The return on the investment can reach as high as 40 per cent – an unbeatable figure."

Nimer said foreign investment by both developers and buyers remains vital for the continued growth of the real estate sector. Foreign individuals and corporates currently represent between 60 and 70 per cent of buyers of freehold units.

Nimer also revealed that some developers are now re-purchasing properties they have developed from current owners to re-invest them in the market with returns ranging between 20 and 30 per cent. Around two to five per cent of developed properties are re-purchased by developers, he claimed.

The MAG Group currently has five property projects across Dubai worth Dh3bn and is expected to grow its portfolio to Dh5bn over the next two years. The company will soon launch Dh800m project in City of Arabia.

The MAG Group is also preparing to enter the Abu Dhabi market and is looking at development proposals in the Northern Emirates. MAG developments are at various stages in the building cycle across the residential, commercial and industrial spectrum and the company is a regional leader in establishing business ethics embracing sustainability and communicating transparently.

 

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