Hijawi Real Estate EN

Jordan real estate market ‘still promising’

motasem — Tue, 05 Apr 2011 11:18:30 +0000

AMMAN –– Experts and economists agreed on Wednesday that the outlook for Jordan’s real estate sector is still promising.They explained that the property market in Jordan enjoys a supply-demand balance, unlike the real estate market in the Gulf region, which was given a negative outlook by Moody’s Ratings Agency due to oversupply of housing units and tight credit conditions.Zuhair Omari, the president of the Housing Investors Society (HIS), said that demand on apartments is expected to grow in the coming months because people realised that prices of residential units are stable and are not going to fall but instead may rise.Over the past months, demand increased significantly on apartments sized less than 180 square metres, which sometimes resulted in supply to be lower than demand, Omari told The Jordan Times yesterday, adding that residential projects also slowed down recently due to the increase in construction material prices, mainly steel and cement.“However, we encourage investors and developers to build more housing projects because we don’t want demand to be too much larger than supply in order to avoid a hike in unit prices, which has led to a slowdown and hurt the sector in the past,” he remarked.Omari stated that Jordan is also different than the Gulf because property prices in the country went down by 15 per cent only, unlike the Gulf region which witnessed a major drop by 40 per cent, resulting in a situation where mortgage loans became much higher than the current value of the housing units.“Many people in Gulf states, particularly in Dubai, sold their houses cheaper than they purchased them or less than their real value. This did not happen in Jordan,” the HIS chief noted.Stressing that supply and demand in the local market is balanced, Rami Adwan, an expert in the real estate and the deputy chief executive officer of marketing and sales at Taameer Jordan Holdings, a major developer, said that official figures also show that demand on residential apartments and trading in the real estate market are on the rise.Official figures confirm that.Real estate trading during the first quarter of 2010 rose by 20 per cent compared to the same period of 2009, according to Land and Survey Department figures, which indicated that trading reached JD1.13 billion compared with JD940 million during the first three months of last year.According to the figures, a total of 4,637 residential apartments were sold in the January-March period of 2010 compared with 3,715 during the same period of 2009.“My opinion on the future outlook for the property market here is that we may have a shortage in supply because it will be decreasing in the coming 12 months while demand will witness an increase,” Adwan added.Stressing that the market is on the right track, Adwan pointed that banks have already started to ease their credit conditions and started to compete on marketing their offers of mortgage loans, stating that there is more room for banks to extend credit facilities.“Creditors in the Gulf are still cautious to extend housing loans because they have sceptical outlook for real estate in their countries, while in Jordan, local banks now believe that the sector is performing well,” Omari said.The real estate sector is affected by factors related to the economic situation in Jordan in general and not to factors specific to the property market as people are still confused and reluctant, he concluded, urging authorities to work for a positive economic outlook.Economist Jawad Anani agreed that there is no excessive supply of housing apartments in the country, adding that there is an oversupply of commercial properties, which could be marketed when the economic circle resumes recovery.But Anani noted that banks are still tightening their retail and corporate lending policies, which he said hinders demand on residential and commercial properties as well as supply.Financial analyst Ali Tabbalat expected that demand on commercial properties would increase within nine to 12 months due to a positive economic outlook for the country.Banks started to extend retail loans with reasonable interest rates because financial institutions realised that their profits dropped in 2009 and during the first quarter of this year due to their strict lending policies, he elaborated.Commenting on Moody’s negative outlook for the real estate industry in the Gulf region due to the oversupply of housing units, Anani explained that what happened in the Gulf, mainly Dubai, was that supply boomed due to speculative demand.He stated that buyers were buying properties off plan in Dubai and paying just a deposit for them before flipping the incomplete units back onto a market where demand was peaking.Those who took this flipping approach never intended paying for their properties, instead they relied on the fact there would be other investors to buy these units off plan but this did not continue which ultimately hurt the entire real estate market there, Anani explained.By Omar ObeidatAMMAN –– Experts and economists agreed on Wednesday that the outlook for Jordan’s real estate sector is still promising.They explained that the property market in Jordan enjoys a supply-demand balance, unlike the real estate market in the Gulf region, which was given a negative outlook by Moody’s Ratings Agency due to oversupply of housing units and tight credit conditions.Zuhair Omari, the president of the Housing Investors Society (HIS), said that demand on apartments is expected to grow in the coming months because people realised that prices of residential units are stable and are not going to fall but instead may rise.Over the past months, demand increased significantly on apartments sized less than 180 square metres, which sometimes resulted in supply to be lower than demand, Omari told The Jordan Times yesterday, adding that residential projects also slowed down recently due to the increase in construction material prices, mainly steel and cement.“However, we encourage investors and developers to build more housing projects because we don’t want demand to be too much larger than supply in order to avoid a hike in unit prices, which has led to a slowdown and hurt the sector in the past,” he remarked.Omari stated that Jordan is also different than the Gulf because property prices in the country went down by 15 per cent only, unlike the Gulf region which witnessed a major drop by 40 per cent, resulting in a situation where mortgage loans became much higher than the current value of the housing units.“Many people in Gulf states, particularly in Dubai, sold their houses cheaper than they purchased them or less than their real value. This did not happen in Jordan,” the HIS chief noted.Stressing that supply and demand in the local market is balanced, Rami Adwan, an expert in the real estate and the deputy chief executive officer of marketing and sales at Taameer Jordan Holdings, a major developer, said that official figures also show that demand on residential apartments and trading in the real estate market are on the rise.Official figures confirm that.Real estate trading during the first quarter of 2010 rose by 20 per cent compared to the same period of 2009, according to Land and Survey Department figures, which indicated that trading reached JD1.13 billion compared with JD940 million during the first three months of last year.According to the figures, a total of 4,637 residential apartments were sold in the January-March period of 2010 compared with 3,715 during the same period of 2009.“My opinion on the future outlook for the property market here is that we may have a shortage in supply because it will be decreasing in the coming 12 months while demand will witness an increase,” Adwan added.Stressing that the market is on the right track, Adwan pointed that banks have already started to ease their credit conditions and started to compete on marketing their offers of mortgage loans, stating that there is more room for banks to extend credit facilities.“Creditors in the Gulf are still cautious to extend housing loans because they have sceptical outlook for real estate in their countries, while in Jordan, local banks now believe that the sector is performing well,” Omari said.The real estate sector is affected by factors related to the economic situation in Jordan in general and not to factors specific to the property market as people are still confused and reluctant, he concluded, urging authorities to work for a positive economic outlook.Economist Jawad Anani agreed that there is no excessive supply of housing apartments in the country, adding that there is an oversupply of commercial properties, which could be marketed when the economic circle resumes recovery.But Anani noted that banks are still tightening their retail and corporate lending policies, which he said hinders demand on residential and commercial properties as well as supply.Financial analyst Ali Tabbalat expected that demand on commercial properties would increase within nine to 12 months due to a positive economic outlook for the country.Banks started to extend retail loans with reasonable interest rates because financial institutions realised that their profits dropped in 2009 and during the first quarter of this year due to their strict lending policies, he elaborated.Commenting on Moody’s negative outlook for the real estate industry in the Gulf region due to the oversupply of housing units, Anani explained that what happened in the Gulf, mainly Dubai, was that supply boomed due to speculative demand.He stated that buyers were buying properties off plan in Dubai and paying just a deposit for them before flipping the incomplete units back onto a market where demand was peaking.Those who took this flipping approach never intended paying for their properties, instead they relied on the fact there would be other investors to buy these units off plan but this did not continue which ultimately hurt the entire real estate market there, Anani explained.

Real estate trading grows by 26% in 2010

motasem — Tue, 05 Apr 2011 11:18:07 +0000

AMMAN (JT) –– Trading in the real estate market in 2010 increased to JD5.97 billion from the JD4.74 billion recorded in 2009, official figures showed Tuesday.According to figures released by the Department of Lands and Survey (DLS), the number of residential apartments sold last year reached 23,721 units compared with 20,513 apartments sold in the previous year, while land transactions witnessed a significant rise from 55,260 in 2009 to 65,714 transactions in 2010.However, despite the 26 per cent increase in trading, DLS revenues fell to JD239.8 million last year from JD270 million registered in 2009, a drop the department attributed to registration fee exemptions the government granted to buyers of residential apartments, which have totalled over JD150 million since the government put the decision into effect in May 2009.The government decided in May of 2009 to extend the exemption from registration fees on the first 120 square metres (sq.m.) of apartments sized 150 sq.m. or less to apartments sized 300 sq.m. or less. In June of last year, the government also decided to exempt the first 150sq.m. (instead of the first 120) of apartments sized 300sq.m. or less from registration fees and slashed registration fees and taxes on properties from 10 per cent to 5 per cent in a bid to stimulate the real estate sector.As the exemption decision expired at the end of 2010, the government decided earlier this week to extend it for three months until March 31, saying the real estate sector has recovered from the slowdown it witnessed over the past two years due to the repercussions of the global financial crisis.Real estate experts expect the sector to perform better in 2011. Acknowledging that government incentives have played a key role in the rebound it witnessed last year, sector leaders expressed disappointment over the three-month exemption period granted by authorities, saying the sector needs at least one extra year to achieve full recovery.AMMAN (JT) –– Trading in the real estate market in 2010 increased to JD5.97 billion from the JD4.74 billion recorded in 2009, official figures showed Tuesday.According to figures released by the Department of Lands and Survey (DLS), the number of residential apartments sold last year reached 23,721 units compared with 20,513 apartments sold in the previous year, while land transactions witnessed a significant rise from 55,260 in 2009 to 65,714 transactions in 2010.However, despite the 26 per cent increase in trading, DLS revenues fell to JD239.8 million last year from JD270 million registered in 2009, a drop the department attributed to registration fee exemptions the government granted to buyers of residential apartments, which have totalled over JD150 million since the government put the decision into effect in May 2009.The government decided in May of 2009 to extend the exemption from registration fees on the first 120 square metres (sq.m.) of apartments sized 150 sq.m. or less to apartments sized 300 sq.m. or less. In June of last year, the government also decided to exempt the first 150sq.m. (instead of the first 120) of apartments sized 300sq.m. or less from registration fees and slashed registration fees and taxes on properties from 10 per cent to 5 per cent in a bid to stimulate the real estate sector.As the exemption decision expired at the end of 2010, the government decided earlier this week to extend it for three months until March 31, saying the real estate sector has recovered from the slowdown it witnessed over the past two years due to the repercussions of the global financial crisis.Real estate experts expect the sector to perform better in 2011. Acknowledging that government incentives have played a key role in the rebound it witnessed last year, sector leaders expressed disappointment over the three-month exemption period granted by authorities, saying the sector needs at least one extra year to achieve full recovery.

Reduction of real estate fees gets favourable reaction

motasem — Tue, 05 Apr 2011 11:15:09 +0000