‘UAE and MENA Home Sentiment Survey – Q2 2020’ sheds light on region’s real estate sentiment post COVID-19
On 28 July 2020 Peninsula Real Estate announced the results of the second UAE and MENA Home Sentiment Survey – Q2 2020, which was conducted by Peninsula Real Estate in partnership with Eltizam Asset Management group, CBRE, Cityscape and Berkshire Hathaway Home Services.
The Survey that was conducted over the first two weeks of July provides an important snapshot of sentiment towards real estate as many of the COVID-19 mitigation measures are being relaxed, based on a compilation of 2500 data points including home owners, renters and investors across the region.
As of the end of Q2 2020:
• In the UAE, 59 per cent of respondents expect the value of their home to fall in the second half of 2020; 84 per cent of respondents who are renters expect to see their rent decline.
• On average, respondents in the UAE expect rents and prices to fall by 8 per cent in the remainder of 2020.
• 75 per cent of respondents who are renters in the UAE and had renegotiated their lease in the last 6 months say their rent fell. A third of these respondents reported that their rent had fallen by 10 per cent or more.
• In Saudi Arabia, 40 per cent of respondents expect rents and prices to fall in the second half of 2020. Only 8 per cent of respondents expect the same outcome in Egypt.
• 70 per cent of respondents in the UAE who were renters think the rent they pay is fair or good value for the property they lease.
Dr. Christopher Payne, Chief Economist, Peninsula Real Estate, said: “Not surprisingly, our second home sentiment survey has demonstrated poor sentiment towards real estate in the Gulf. Rental negotiations incorporate market movements over the previous 12 months, which may be why owners’ expectations for the UAE are more positive than renters for the remainder of 2020. Owners’ perceptions are both more positive for the second half of 2020 than renters and reflect improved sentiment when compared to their views on the past six months. No doubt reflecting COVID-19’s impact on an already weak market, 50 per cent of respondents thought the price of their home had fallen by at least 10 per cent year-to-date.”