UAE’s real GDP is estimated to have grown by 2.9% in 2019, according to the quarterly economic review of the Central Bank of UAE for Q4 2019.
The central bank’s latest GDP growth estimate is much higher than the 1.6% estimated by IMF, and its own previous estimate of 2.3%. The central bank also observed that there have been robust improvements in the labor and credit markets. The non-oil real GDP is estimated to have picked up a momentum to 2.4% compared to the estimated 1.2% growth in the 3rd quarter.
A zero-deficit federal budget amount of AED 61.4 billion has been approved for UAE’s Fiscal year of 2020, which represents 2% increase from the last year’s budget, making it the country’s largest federal budget to date. (Ministry of Finance).
The recent Government announcements related to One Free Zone Passport, dual-licensing, and full ownership of onshore companies, and reduction of market fees imposed on businesses by the Dubai Municipality are expected to generate employment, investments, demand and overall business activities in Dubai. To further stimulate the tourism industry, the Government has decreased municipality fees and licensing fees, which has had an immediate uplifting effect on hotel occupancy.
DLD developed the new electronic system, Mollak, in January 2020, which governs ownership of the real estate, among many other features.
Dubai Land Department has further developed an online smart real estate services platform called “Dubai REST” application, which allows investors and owners to access real estate market related news, data and information, and hence make prudent real estate investment decisions.
In 2019, and during the last couple of months, we see a rising trend in the number of real estate transactions in Dubai (Source: REIDIN), and developing optimism in the property market throughout UAE.
The graph below shows the residential supply of Dubai Residential Market. As of 2019, 555,000 units were delivered and for 2020 and 2021, the supply is expected to rise up to 638,000 and then, pick up marginally to 671,000.
With property prices being so attractively low, good rental income, Expo 2020 being around the corner, and many government initiatives to fortify the real estate market in the UAE, we keep our positive stance for the medium to long term.