Avoid 'dumping' properties in 2021: Damac chairman

Dubai - The chairman of Dubai’s largest private developer sees next year as challenging too

Next year is going to be yet another challenging one for the property market and big developers should avoid “dumping” properties in an already oversupplied market, said Dubai’s largest private property developer.

“2020 has been a very difficult year globally and more difficult for the property market. Going forward, I don’t think 2021 is going to be better. We still have a glut and the market is going to be very challenging,” said Hussain Sajwani, chairman of Damac Properties.

“I hope big developers don’t start dumping more supply just because they can sell 200 villas or apartments more. We are very careful and are not going to bring new products to the market, maybe few hundred or less than hundred just to keep the momentum going. We have no intention of expanding because the situation doesn’t look rosy going forward,” Sajwani told Bloomberg TV.

Property prices are down by nearly one-third since 2014 due to massive oversupply. As a result, Dubai government had set up a committee to oversee supply and demand which has helped the market to attain balance.

Sajwani had said last year that demand-supply balance is likely to be achieved by 2022.

Emaar Properties founder Mohamed Alabbar said during a recent conference that property prices in Dubai are reasonably priced and demand is picking up.

“Real estate business is cyclical. We have an oversupply, [but] Dubai is reasonably priced. Our prime time price was a little lower than Chicago. Good demand continues from India, Saudi Arabia, Russia and China,” Alabbar said.

Real estate website Property Finder said last week that secondary residential property sales in November 2020 broke a seven-year record as local real estate steadily recovers from the impact of the pandemic and oversupply. The top areas for secondary apartment sales in November 2020 were Dubai Marina, Business Bay, Barsha Heights (Tecom), Downtown Dubai and Jumeirah Village Circle.

Sajwani said Dubai has done a great job in controlling Covid-19 and by opening the economy gradually in a phased manner.

“Dubai is the only city in the world that has hotels and restaurants full and people are enjoying lives. Yes, there are cases but mild. So things have been controlled very well. Globally, things are scary. But the good news is that we have found a vaccine and hopefully it will work,” Sajwani said during the interview.

The Damac chief, however, ruled out any plans for new acquisitions.

waheedabbas@khaleejtimes.com