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Dubai sees sharp rise in new home handovers in first half

Dubai sees sharp rise in new home handovers in first half

DUBAI: Dubai’s developers have shifted into higher gear on their handover schedules, with the first-half of this year recording 13,315 homes being delivered. This compares with the meagre 5,039 units completed in the same period last year, while the first half of 2015 tally was 8,714 units, based on data from Reidin-GCP. But even if the first half of 2017 pace of delivery is maintained, the prospect of developers being able to meet their full-year expectations of 34,172 units does appear remote. For confirmation, look to their recent track-record. “The realisation rate [of actual deliveries against start of the year estimates] has been systematically lower on a year-over-year basis all through the last five years,” said Sameer Lakhani, Managing Director at the consultancy Global Capital Partners. 
“It’s our opinion that this year the realisation rate will be 79 per cent, thereby resulting in an anticipated handover of 27,116 units.”

For the record, in 2015 and 2016, full-year deliveries totalled 11,879 and 14,892 units, respectively. The gap between promises and the reality could become more stark next year. “In 2018, the anticipated pipeline is expected to surge with an expectation of 70,785 units being handed over,” said Lakhani. “This is the why there’s been a lot of hand wringing over potential oversupply. “But we believe the realisation rate in 2018 will be at 44 per cent, resulting in a more modest 31,266 units getting handed over. Developers have become more savvy at adjusting realisation rates on a year-over-year basis and accordingly ‘managing’ supply.”