The 2019 launch of a Higher Committee for Real Estate Planning could go on to be a key turning point for Dubai's property market, according to Chestertons.

Designed to shape several key areas of real estate policy, members of the committee include the General Secretariat of the Executive Council of Dubai, Dubai Land Department, as well as various semi-government real estate developers including the Investment Corporation of Dubai, Wasl Properties, Dubai Properties, Emaar Properties, Meraas, Nshama, Nakheel Properties, Meydan, Dubai Silicon Oasis Authority, Dubai South, and Dubai Multi Commodities Centre.

Chestertons Head of Strategic Consulting Chris Hobden said the formation of the body created the opportunity to revise the way that future projects were assessed, raising the prospect of a new planning policy framework capable of "addressing the current supply imbalance and shoring up market sentiment".

"Supply is now widely recognised as the single largest contributor to Dubai’s declining residential prices, with limited off-plan sales, coupled with rising levels of unsold developer inventory, continuing to place downward pressure on values," he said.

"There are currently around 150,000 residential units scheduled to complete between 2020 and 2021, over double the number built within the past two years.

"While it is likely that a significant minority of planned projects will overrun their scheduled completion, the volume of units, by any measure, is clearly out of step with current market-wide sales performance. 

Chestertons Head of Strategic Consulting Chris Hobden. Source: Chestertons

"Longer-term though, the Committee’s remit could present a range of developer opportunities, rewarding new project innovation while providing buyers confidence in the stability of market fundamentals."

Mr Hobden said Dubai had an "enviable" track record of leading-edge design and incorporating a planning framework that sought to ensure the development of ‘unique’ projects could only be welcomed.

"This requirement may further encourage the inclusion of alternative sectors, such as healthcare and education, into mixed-use schemes and lead to revisions in the way that conventional building designs embrace technology and adapt to the increasingly flexible and collaborative ways in which people choose to live and work," he said.

"Significantly, this also suggests a restriction of generic developments that are unable to demonstrate clear market demand. This is a crucial factor in underpinning residential pricing and ensuring the long-term value proposition of the market."

Click here to read more about the committee and the Dubai market in Chestertons' quarterly edition of the Observer report.

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