DUBAI // The whiteboard inside the headquarters of Sherwoods Property Consultants does the talking.
One column lists the considerable bonuses awarded to staff for recent sales.
But a second shows a string of pending deals that stretches to the bottom of the board; the prospective buyers may be awaiting loans or looking to ride out the global financial storm.
It is a far cry from the frenzy that gripped the UAE housing market this past summer, when people queued for hours at Cityscape Abu Dhabi in the hope of snapping up any available properties.
Vincent Easton, a sales director with Sherwoods in Dubai, said: "It came very quickly. We almost went from a position where we still had queues at launches and fights breaking out - a frenzy of wanting to purchase something, anything, it didn't even matter what it was - to a position where almost overnight it stopped.
"There wasn't really any sign of that happening. It was a shock and it was all borne from the financial crisis. No one expected banks and financial institutions to collapse. The whole world went into panic mode."
The biggest change, Mr Easton said, saw the market move from one dominated by speculators looking to sell properties for a quick profit, to one dominated by the end-user, who will either rent out or live in the finished building.
"It is another sign of Dubai maturing. We always knew it was going to do this as we moved from an off-plan, speculative market to the end-user market. To do that, a maturity needs to take place across the industry and we welcome it.
"Having a big name linked to the building and knowing the square foot price are not enough now. They want to know who the developer is. They want to find out whether quality can be delivered."
Mr Easton said that, as the number of completed properties in Dubai increases, the more the market would be ruled by end-users.
For now, those looking to buy are struggling to obtain mortgages. Many banks are now offering most customers only 50 per cent of the cost of homes.
Melissa Schier, a British sales consultant with Sherwoods, joined the company just before the slowdown and said the market had matured considerably in a short time.
"If you go back five months, you are looking at a real mixture of clients. I was still selling to end-users, but also to a lot of investors.
"I would say it was in September that we started to see the big investors and the big speculators slowing down, and people asking a lot more questions. Clients who were looking at buying were all of a sudden looking to sell. "The biggest thing, though, is that people are making offers, which we did not see until a few months ago. Properties were going for the asking price because people didn't really consider negotiating."
She said that two areas of the city in particular, Discovery Gardens, which was recently completed, and International City, were becoming more popular with end-users,
Mr Easton said: "We have genuinely got a queue of people that would purchase and are ready to purchase. We have stock available if they can get the finance.
"We fully understand the reasons banks are reluctant to lend speculatively in the real estate sector. However, if Dubai wants to secure its real estate market, it has to ensure finance is available for the end-user. It is unrealistic for people to put 50 per cent down on a Dh7 million property.
"The banks are telling us that they are prepared to lend up to 80 or 85 per cent, but there are a lot of criteria attached to that. Whether that needs to be relaxed is open to question, but there needs to be more attractive options available to a purchaser for them to invest in a property."
Although the financial crisis has seen jobs cut in the building sector in Dubai, and some projects shelved or delayed, Mr Easton said he expected a healthy medium-to-long-term future for Dubai property. "The whole industry, from banks to brokers, is going to have to adapt.
"The fittest will survive and there will be casualties.
"They will be the people who have entered the market purely to make quick money, whether it is developers or brokerage firms who didn't have the experience and wanted to make money when times were good."
rhughes@thenational.ae
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
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What should do investors do now?
What does the S&P 500's new all-time high mean for the average investor?
Should I be euphoric?
No. It's fine to be pleased about hearty returns on your investments. But it's not a good idea to tie your emotions closely to the ups and downs of the stock market. You'll get tired fast. This market moment comes on the heels of last year's nosedive. And it's not the first or last time the stock market will make a dramatic move.
So what happened?
It's more about what happened last year. Many of the concerns that triggered that plunge towards the end of last have largely been quelled. The US and China are slowly moving toward a trade agreement. The Federal Reserve has indicated it likely will not raise rates at all in 2019 after seven recent increases. And those changes, along with some strong earnings reports and broader healthy economic indicators, have fueled some optimism in stock markets.
"The panic in the fourth quarter was based mostly on fears," says Brent Schutte, chief investment strategist for Northwestern Mutual Wealth Management Company. "The fundamentals have mostly held up, while the fears have gone away and the fears were based mostly on emotion."
Should I buy? Should I sell?
Maybe. It depends on what your long-term investment plan is. The best advice is usually the same no matter the day — determine your financial goals, make a plan to reach them and stick to it.
"I would encourage (investors) not to overreact to highs, just as I would encourage them not to overreact to the lows of December," Mr Schutte says.
All the same, there are some situations in which you should consider taking action. If you think you can't live through another low like last year, the time to get out is now. If the balance of assets in your portfolio is out of whack thanks to the rise of the stock market, make adjustments. And if you need your money in the next five to 10 years, it shouldn't be in stocks anyhow. But for most people, it's also a good time to just leave things be.
Resist the urge to abandon the diversification of your portfolio, Mr Schutte cautions. It may be tempting to shed other investments that aren't performing as well, such as some international stocks, but diversification is designed to help steady your performance over time.
Will the rally last?
No one knows for sure. But David Bailin, chief investment officer at Citi Private Bank, expects the US market could move up 5 per cent to 7 per cent more over the next nine to 12 months, provided the Fed doesn't raise rates and earnings growth exceeds current expectations. We are in a late cycle market, a period when US equities have historically done very well, but volatility also rises, he says.
"This phase can last six months to several years, but it's important clients remain invested and not try to prematurely position for a contraction of the market," Mr Bailin says. "Doing so would risk missing out on important portfolio returns."
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