Dubai rents may be bottoming out as ‘green shoots’ appear

The Dubai property market still faces supply challenges. (AFP)
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Updated 20 January 2020

Dubai rents may be bottoming out as ‘green shoots’ appear

  • An estimated 45,000 homes were completed in Dubai in 2019 according to Chesterton estimates

LONDON: Confidence may be returning to Dubai property despite a bloated market for off-plan homes, according to a report from Chestertons, the real estate broker.

Although apartment and villa sales prices were down 2 percent and 3 percent respectively in the fourth quarter of 2019 compared to the previous quarter, rental rates are stabilizing.

But supply issues continue to represent the biggest challenge facing the market, with 45,000 new units completed in 2019 and that expected to double this year.

“The Dubai residential market in Q4 2019 is alluding to a more positive outlook for 2020 thanks to the slowdown of sales price declines and the leveling of rental rates,” said Chris Hobden, of Chestertons MENA. “This does, however, have to be tempered by the volume of new units scheduled for delivery in 2020, which makes the short-term recovery of prices in the emirate unlikely.”

In the rental market, no movement was witnessed in the fourth quarter with the market supported by a draft law which would fix rental rates for three years upon the signing of a contract. 

“To ensure high occupancy in 2020, landlords will have to be realistic in the face of tough market conditions. The incentives previously offered to tenants, such as rent-free periods, multiple cheques and short-term leases, will continue, with an increase in tenant demand for monthly direct debit payments also likely” added Hobden.


Kuwait MPs launch probe into Airbus deal

Updated 19 February 2020

Kuwait MPs launch probe into Airbus deal

  • The decision came after a debate on allegations that Airbus paid kickbacks to secure a deal 6 years ago
  • The parliament also asked the finance ministry to review recent aircraft deals involving state-owned Kuwait Airways

KUWAIT CITY: Kuwait's parliament on Wednesday formed a fact-finding panel to probe alleged kickbacks in a deal between the national carrier and Airbus, which last month paid massive fines to settle bribery scandals.
The parliament's decision came after a special debate on allegations that Airbus paid kickbacks to secure a 25-aircraft deal six years ago.
It also asked the Audit Bureau, the state accounting watchdog, to investigate the deal, which was reportedly worth billions of dollars, although exact figures were never released.
Kuwait Airway Co. in 2014 ordered 15 Airbus 320neo and 10 Airbus 350, with delivery beginning last year and continuing until 2021.
Opposition lawmaker Riyadh al-Adasani told the session that Kuwait was mentioned in a settlement struck by Airbus in a British court on January 31, along with the names of some Kuwaiti officials and citizens.
Under the settlement, Airbus agreed to pay 3.6 billion euros ($3.9 billion) in fines to Britain, France and the United States to settle corruption probes into some of its aircraft sales.
Days after the settlement, Sri Lanka ordered an investigation into a multi-billion dollar aircraft purchase from Airbus after the deal was named in the settlement.
The former chief of Sri Lankan Airlines, Kapila Chandrasena, was arrested on February 6 for allegedly receiving bribes relating to the deal.
Earlier this month, two senior officials of the Malaysia-based AirAsia stepped aside while authorities probe unusual payments at the carrier, as the fallout from the Airbus scandal reverberated across the industry.
Kuwait in recent years also initiated criminal investigations into two large military aircraft deals involving Airbus -- a $9 billion Eurofighter Typhoon warplanes deal and a contract for 30 Caracal military helicopters costing $1.2 billion.