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Investors get more bang for their buck |
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12/12/2008 9:28:43 AM |
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Aeroplanes, cars, mobile phones and more. As developers vie for customers, adding incentives and perks to properties is becoming a common weapon to encourage investors to part with their cash.
Private developer Damac pioneered this trend by promising every purchaser of its apartments a car and entry into a draw, with prizes such as a boat or a Dh5.5 million private jet up for grabs.
Although some of these extravagant offers no longer exist, there are promotions that are offering added value to new investments.
Damac does not currently have an offer with the same 'wow' factor – which featured Bentleys, Aston Martins and Lamborghinis – but its CEO Peter Riddoch said its position was constantly under review. "As a multinational, Damac Properties embarks on innovative marketing promotions to support its overall sales strategy," he said.
"We conduct similar promotions throughout the year across the countries we operate in and will continue to do so," said Riddoch.
In the current economic climate, many people are wondering if now is the right time to buy. With speculation that prices will experience a slowdown in 2009, some potential buyers are holding off to get more for their money. But a new wave of developers are offering more "common sense" incentives to lure buyers to part with their dirhams.
The days of free cars may be – temporarily – consigned to history, but in their place are discounted apartments and extra services.
Emaar is pioneering schemes called Rent to Own and Plan to Own to make it easier for buyers to afford a home in Dubai.
The first allows people living in some Downtown Burj Dubai properties to have their first year's rent put towards a down payment if they decide to buy within 10 months of moving in.
Buyers have to find a 70 per cent mortgage with the remaining amount – up to 25 per cent – paid to Emaar over the next five years.
An Emaar spokesman said: "The Rent to Own programme facilitates easier property transactions in prestigious residential properties such as those within Downtown Burj Dubai by providing customers the flexibility of living in a property, experiencing the qualitative difference provided by Emaar to help them make informed purchase decisions."
This initiative compares to Plan to Own, which has some like-for-like features, such as a 70 per cent mortgage and 25 per cent extended payment plan, but differs in that buyers only start paying one year after handover.
"The Plan to Own programme will offer flexibility, making it possible to bridge the current gap due to lower loan-to-value ratios offered by banks and financial institutions," said the spokesman.
In a time when securing a mortgage has become difficult, especially for those who are self employed, Emaar said there had been a good uptake of customers for these schemes, but refuses to release precise numbers.
Cecilia Reinaldo, Managing Director of Fine and Country UAE, says these strategies are vital: "With property marketing becoming more mature in the region – and with greater levels of caution being shown by international investors – serious developers are looking to create a more flexible payment environment for consumers," she said.
"This, in turn, will attract non-cash buyers and help them facilitate the purchase."
Getting money back – or money off – is always going to have mass appeal and as developments continue to come onstream, it could be a deal-clincher.
Although some have been put on hold until the global financial crisis passes, other developers are surging ahead with projects as planned and as such are still making their presence felt in the market.
The First Group is offering a Dh50,000 discount on some of its properties, which span communities including Jumeirah Village and Dubai Sports City, but it only applies to existing clients.
A one-bed property in The First Group Tower in Jumeirah Village South starts at Dh1m, thus the offer represents a five per cent discount, but new customers would be better off taking the 15 per cent discount offered on other, similar units – thereby saving an extra Dh100,000.
Although some of First's other towers have already sold, it still has The Matrix on the market, which overlooks the Els Golf Club in Dubai Sports City, as well as projects in Umm Al Quwain and Ras Al Khaimah, including Beachside at White Bay. |
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Source: Business24-7.ae |
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