After a slight downturn in February, sales of residential property in Kuwait were up almost 200 percent in March, over the previous year. Meanwhile, in Dubai, delinquent owners are facing seizure of near-completion plan properties, by officials responding to the rash of defaults in the wake of plummeting values. See the following article from Property Wire for more on this.
Residential real estate sales in Kuwait increased 194% in March compared to a year ago with the market overall recording 130% growth, according to the latest official figures.
A high turnover in residential and investment property meant that sales in the Gulf Arab state rose to 205.83 million dinars ($714.6 million) from 89.35 million dinars in March 2009, the data also showed.
The statistics were a surprise as in February real estate sales were down 1.7% compared with the same month in 2009.
‘March data suggest that there may be scope for activity to surprise on the upside, helped by improving confidence and stronger demand for land, especially as the government pushes on with its economic development plans,’ said a spokesman for the National Bank of Kuwait.
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Meanwhile the authorities in Dubai are planning to seize off plan properties if owners are in default on payments. Investors who fail to make outstanding payments within two weeks could lose their property, according to Mohammed Sultan Thani, assistant director general of the Dubai Land Department.
The decision, which applies to properties that are more than 80% complete, will help several delayed and unfinished projects in Dubai reach completion, he said. ‘The idea is to see what we can do before the property is canceled. Very few people will opt for not completing payments if the building is almost ready,’ he added.
Some 40% of any money paid so far will be confiscated and the property will be sold at auction with the profits going to the developer.
During the property boom in Dubai many developers depended on the off plan model, which analysts say fuels speculative buying and inflates prices since the property is sold before building work starts to provide finance for construction.
But as the global financial crisis hit the region and property prices fell more than 50% in Dubai, many buyers reportedly stopped paying their monthly installments on properties that had fallen sharply in value.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.