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Qatari property investors keen to offload assets in UAE

dubai - Some have sold properties at greatly reduced prices, say Dubai brokerages

Qataris with property investments in the UAE are in a state of limbo. In a kneejerk reaction, some of them pulled the plug on their investments and sold at vastly reduced prices whereas a majority is still hopeful that the row will be resolved.

Investors from Qatar and Kuwait cumulatively accounted for Dh2 billion worth of property transactions in Dubai last year, according to the Dubai Land Department.

"The majority of our Qatari clients are in a state of confusion as to what to do. Some have sold and at greatly reduced prices but many are just waiting before deciding what to do next," says Mario Volpi, chief sales officer, Kensington Exclusive Properties. "There have been some sales, particularly from one Qatari investor who has liquidated his entire portfolio before the initial two-week deadline to leave the UAE."

The level of discounts offered varies from seller to seller, but typically the amounts range from 10 to 15 per cent below market price.

"We did find a sudden increase in the number of Qatari owners who decided to sell their assets in Dubai. Some time has since passed and while we are still assisting some of these owners, the sudden spike of interest has subsided," observes Nick Grassick, managing director of PH Real Estate.
However, another Dubai real estate brokerage, which wishes to remain anonymous, claims there is no sense of desperation among its Qatari clients. "There is no sense of panic and our clients believe the problem will get resolved," it adds.

Qatari investors, like the rest of their GCC counterparts, prefer to purchase apartments, shops and offices in the UAE that provide a stable source of income and good returns.

Preferences
"Typically, the Qatari investor prefers to buy apartments and stay within the established areas of Dubai such as Downtown, the Palm Jumeirah and Dubai Marina," Volpi points out.

Brokerages say the majority of Qataris who buy property in the UAE are based in their home country.

"Investors, by their nature, are not owner occupiers of their investments and quite often reside outside the country of their investments," adds Grassick.

As a result of tightened restrictions, selling property has become more difficult for Qatari nationals. Without being allowed into the country, sellers would have to sign a power of attorney to enable a non-Qatari to sell property on their behalf.

"Given that a Qatari seller is no longer allowed to enter the UAE, he/she would have to arrange to meet the power of attorney [POA] in a neutral country, say Oman or Kuwait, to prepare the POA documents. The POA can fly back to UAE to then sell the property. This would only work if the seller also has a UAE bank account or the buyer would agree to pay by bank transfer," informs Volpi.

What about UAE nationals who own property in Qatar? "Most UAE investors we speak with think this is a temporary issue and will be sorted out sooner than later. So, not many are taking this as a factor in their investment decisions," says Sanjay Chimnani, managing director, Raine & Horne Dubai.

- deepthi@khaleejtimes.com