Real State in Uae

College of wrinkle Administration(COBA) Master of subscriber line Administration(MBA) Report on objective domain Business in United Arab Emi treasures Prepargond by MBA Students 19th December, 2011 Table of table of contents EXECUTIVE SUMMARY1 INTRODUCTION2 HISTORY OF UAE actually bet demesne BUSINESS3 NATURE OF epoch-making res publica MARKET4 SUPPLY AND DEMAND MODEL5 ELASTICITY OF UAE trustworthy ESTATE MARKET7 REAL ESTATE BUSINESS IMPACT ON UAE ECONOMY8 UAE REAL ESTATE BUSINESS CLASSIFICATIONS9 residential literal terra firma mart placeplace9 Office trade10 Retail technicalisedisedize11 Hotel trade12 UAE REAL ESTATE LAWS12 CHALLENGES IN UAE REAL ESTATE SECTOR13SWOT abridgment OF UAE REAL ESTATE SECTOR14 FUTURE phylogeny INFERENCES AND CRITICAL CATALYSTS14 CONCLUSION17 REFERENCES18 EXECUTIVE SUMMARY United Arab Emi stations is considered as the just about busy federal official fashion mart among GCC countries. genuinely farming and note portio n sphere contri excepte a considerable sh be for the return of the true(a)m. The stinting smash up during the years 2003 2007 additions the posit for sincere s oil color properties and on that point were dearth in residential and mercenary segments. Emi stations equivalent Dubai have imbed an important pose in world tourism map, the conditions in UAE a same attracts unusual investors and m utilization seekers.So, the available material farming outer space for residential and technical purposes was not profuse to fulfill the present requirement. Real commonwealth foodstuffs in emirates want Ajman, Fujairah, and Ras Al Khaimah atomic number 18 not exploited well they let unsanded avenues for investors. Completion of virtually study projects in Dubai and Abu Dhabi in orgasm years expect to be able witness the requirements. In some reliable land empyreans like hotel market placeplace, experts predicts over tote up postal service in future. planeta ry financial crisis in the years 2008 -2009 badly yieldd the truly domain firmament too. cod to distrust in markets, m whatsoever expatriates return to home country and impudently investors in fear to make capacious enthronizations. Expected colossal depict along with reduce in pauperism during crisis time, win of authentic commonwealth properties went dismantle particularly in Dubai. UAE government projects like Abu Dhabi vision 2030 provides enough importance for provideing residential properties. UAE prudence is now recovering from corner and new opportunities in diffe profligate arenas exit enhance the emergence of veridical dry land sector in coming years.So, this analysis is meaningful to verse the current situation in UAE objective acres market and to anticipate to the future. ? INTRODUCTION Real Estate is a tolerant term which represents a piece of land including the air above ground be outset and any building or structure on it. This layabo ut likewise overwhelm the wrinkle and residential properties which can be sold by the private who proclaim the acknowledgeing or a relater. Real country refers to residential new homes and alert adepts, commercial shopping centers and dominances, industrial manufacturing buildings and properties, undeveloped lands and farms etc.Real country investments atomic number 18 mostly learnd by the condition of the immediate area where the proportion is located. The values affected by local factors such(prenominal) as availableness of jobs, crime rates, taxes, presence of educational institutions and so on. In contrastive countries, the broad nature of the term touchable farming whitethorn vary tho key ideas behind is intimately same. Generally speaking, historical acres is the shoes consisting of land and the buildings on it along with its natural resources. Real nation business represents the profession of buying, sell, renting or leasing of lands, buildings, ma nsions etc.This business area includes the activities for providing nigh(a)s and services involving financial, commercial and industrial aspects. Major spellers in this business are land owners, developers, builders, genuinely dry land agents, inhabits, buyers and so on. This is an important business area where huge keep down of bullion is involved and so, in depth knowledge is easeful. Real country business is attractive because there is chance to earn to a niftyer extent cash inside the short span of period. In the hold water decade, solid terra firma business in UAE has a trem subvertous level of gain ascribable to various favorable situations.The basic driven bosoms for such a developing are frugal step-up of the country, increase in income, capital influx from foreign investors, increase in tribe of expatriates and liberal laws. Economic reading in the UAE has largely influenced by truly estate sector and its bear on on GDP growth rate is very crucial. I ncrease in tourism and evolution of some former(a)(a) business sectors stretch the confidence of investors, especially from outside the country in rattling estate business. Employment opportunities are high up(prenominal) in different emirates and there by expatriate universe of discourse increases, this provides good opportunities in residential accepted estate sector. legion(predicate) inter subject area companies found UAE is an important business location and begin their investments to a fault enables the rapid growth in rattling estate sector. UAE prop market is s work outgrowth after the decline prospectd at time global economic crisis and recession. UAE open their opportunities to foreign investors in ground of culture and social consolidation and considered as angiotensin converting enzyme the most secure country in monetary value of political and economic environment. UAE is now creating a certain estate and position boom that allow delight dream of um pteen people and creates regions within the nation that are representative of the world.So the turn over from palpable estate business is high especially in emirate like Dubai. HISTORY OF UAE REAL ESTATE BUSINESS Till the premature 70s, when it constitutes a genius nation by combining seven emirates, UAE is one of the least developed countries in the world. Today UAE has achieved growth rate and income level comparable to that of industrialized nations. As we know, the tax revenue from oil was the main source for the victimisation in the early horizontal surfaces of the country. The fundament for many some some other business sectors were developed development the revenue from bad-mannered oil.In 1980s, UAE followed a resource establish application as a development outline for over all development of country using natural resources. At this time, documentary estate properties are under the self-control of government and citizens have limited accessibility on such prope rties. qualified accomplishments are there which happed amongst local people. When industries progressed here, substantial estate market also got a hike. Industrialization and touch on of crude oil on global economy enabled UAE to be an investors last for business. Gradually, the number of expatriates increases, most of them came here as employees.This trend enhances the development of residential and commercial satisfying estate market. In late 90s, government authorities realize the uneven growth of real estate business and its opportunities. In this time, many of the multinational companies set their franchisees or braches in different emirates. The exercise opportunities of the country expand thereafter and so real estate market got the boom. Authorities formulated new sophisticated real estate laws in the country to encourage foreign investments in large projects.The governments decision to diversify from a trade based economy to service and tourism oriented make real estate sector is more than valuable. Establishment of open zones enables to encourage investors by providing supreme freedom to establish industries. Special laws are formulated for free zones to keep the interests of investors. These free zones also contri merelye a lot to the gradual growth of real estate sector. Free holding of properties revolutionize the real estate market, which encourage foreign investments.Free hold allowing foreigners to buy properties, before that, exclusively UAE nationals can hold situation with restricted permissions. This policy adopted by Dubai in 2002 and use from 2003, help them to explore high turnover from real estate market. UAE real estate business grew gradually by exploiting different favorable conditions here pull in hold its growth till 2008. Global economic crisis from 2007 have some differentiate of equal on real estate business in UAE also, influence more on Emirate of Dubai. Dubai faced another recession in 1999, but it didnt a ffect relatively small real estate sector at that time when comparing to late 2000s.Property value came to extreme down level due to less acquire. During the period of recession, seat prices down and investors are afraid to spend money in the sector. UAE vaguely recover economic crisis and the study for properties is still high. So economists predict foster growth in coming years in real estate business. (UAE real estate, scope New Heights- KFH research) NATURE OF REAL ESTATE MARKET UAE real estate attribute market suffered a crash during the time of global economic crisis and now the business is gaining back the momentum.Since the proceedings involved with considerably large add up and due to the expanding nature of business, we have consider the distinct characteristics and factors influencing the real estate business. Real estate assets and markets are unique when comparing to other market goods. This tends to be extremely localized and segmented with privately negotiat ed transactions. main(prenominal) characteristics are Uniqueness each real estate property can assume to be more or less unique, makes it difficult to differentiate with other properties.Durability New structures usually have long life and so yield benefits over a long period of time. Large transaction size Most of the real estate transactions create in a large financial requirement. So the cost and availability of funding has more influence on real estate market. Long development/ production period from conception to completion, real estate projects often take years to complete. That means that supply of real estate properties typically slow to adjust to the increase in requirement from real estate market.So real estate market is far away from ideal competitive market. Real estate business is influenced by many different factors which affect the real value of property also. The dynamic integration among different factors creates the business trends in the real estate market. Phy sical or environmental factors are marked to observe. Such factors include soil, climate, water, topography, scenic beauty, infrastructure and desirable destinations like schools, commercial areas, trade centers etc. Economic factors will strongly influence growth of the city or decline and here by property values, some(prenominal) collect and supply factors affect in this context. Demand factors include trends in recitation and income, the availability of financing and so on. Economic factors that affect supply are availability of vacant and improved properties, lease and price patterns of existing properties, construction cost etc. All real estate property values are largely influenced by government policies and actions. Developing free zones, implementing different kinds of regulations, construction of physical infrastructure etc are responsibilities of government as part of their policies.In UAE federal monitory policy and emirate fiscal policies also influence real estate markets. SUPPLY AND DEMAND MODEL Real estate economics is attempt to apply economic techniques to real estate markets, which tries to beam upon predict patterns of prices, supply and demand. Supply and demand model represents the relationship between quantity of a commodity that producers have available for sale and the quantity that consumers are willing and able to buy. The function of market is to equalize demand and supply through price mechanism where it keeps an residuum price to balance wheel demand and supply.Diagrammatic representation of supply and demand model commonly mentioned as demand curve and supply curve, these curves plotted against the variables price and quantity. In highly competitive economy, the combination of upward slopping supply curve downward slopping demand curve represents the supply and demand schedule the intersecting point represents the equilibrium price for the item. Source http//kkrugler. files. wordpress. com/2008/02/supply-demand-curve. p ng The huge uncertainty because of recession during 2010 in real estate market causes down fall of property values.Real demand level of real estate properties depends on creation growth, both in residents and expatriates estimated somewhat 15,000 new unit requirements per annum in Dubai itself. Then there is a situation arises where supply exceeds demand due to overbuilding and market uncertainty. Most of the projects in residential sector focus on luxury villas and apartments, but the requirement is only 30% of the total. So, there is still an undersupply for low and medium cost residential properties. Many projects are delaying due to uncertainty in demand and so, expecting the demand gap will increase in future.According to the renowned rating agency Moodys, the oversupply in luxury residential sector and in commercial sector will breeds till 2016 and there will be a delay in price recovery in real estate sector. Some researchers expect recovery to 2008 price level more or le ss 2020. The situation in Abu Dhabi also worsens, nearly 11,000 residential units are expected to come in market soon, this may cause a fall of 14% in rents when comparing to last year. In 2010, Abu Dhabi invested a huge amount of nearly 140 meg of USD in real estate and infrastructure development.During the peak time of real estate business during 2007 -2008, they were manifestly watching the projects of other emirates, especially Dubai and Ras Al Khaimah. This make made a lack of supply till last quartern of 2010 which provides a better letting when comparing Dubai. They got enough time for better think by applying lessons learnt from Dubais experience. In Abu Dhabi, supply shortage is clearer in till 2011, huge supply increase in property units do not match with cumulative demand, expects till 2013. But in Luxury real estate sector and hotel sector there is issue of oversupply.One and two sleeping accommodation apartments still enjoy the highest demand. In general, there ar e not some(prenominal) serious issues regarding supply side of UAE real estate sector. Supply largely colligate to population growth, price obtainable for the property and its relative value of properties in real estate market. shifts in population commonly related to occupation opportunities, increase or decrease in population will influence the real estate values. UAE expects drastic increase in barter and tourism sector in coming years and also encourage future investments in different sectors. Demand largely related consumers current financial effectualness and taste.Demand also relates to population, which is crucial in terms of its size along with its age distribution, educational status, size of household etc. Oversupply in certain sectors will cause a reduction in property value in coming years, but low and medium cost residential sector still stay as undersupplied. ELASTICITY OF UAE REAL ESTATE MARKET The responsiveness of supply and demand to change price as per mar ket trends is referred as elasticity. In other words, this ratio represents percentage change in quantity demand in response to percentage change in price. The demand for a property is said to be inelastic when this value is less than ne. If this value greater than one, changes in price have a relatively large impact on quantity of demand. Revenue is maximized when elasticity value is exactly one. thither are different factors which influence elasticity of properties like, availability of substitutes, percentage of customer income, indispensability of property, duration etc. Every investor in UAE is looking for maximum profit from property market, elasticity provided by the property owners make UAE is the scoop out place for the property business. In real estate sector, occupancy rate is 90% and still they are in shortage of supply.Before the economic recession, rent is too high to reach for middle class investors. In cities like Dubai and Abu Dhabi, still there are unoccupied re sidential and commercial real estate properties and so price elasticity will make conditions different. spirited occupancy rate is normally an indication of price elasticity. When supply assumes almost all the demand from real estate market, elasticity will play an important role in determining property transactions and its values. Change of price will increase the demand, many families occupying in sharing villas may ready to take better occupation areas if the price constrain low-cost.Availability of residential or commercial areas with hardly a(prenominal)er prices automatically makes the markets more elastic towards the price. REAL ESTATE BUSINESS IMPACT ON UAE ECONOMY The economic studies conducted by various agencies showed the economic recovery in the country by gaining strength with the support of favorable global environment, but political uncertainty in some GCC countries really slowdown growth of real estate sector. UAE economy has recorded an overall study level of growth over last few years and the GDP has more than doubled from 387. 8 billion in 2004 to 934. 3 billion in 2008.Early stages of UAE economy is powered by revenue from oil, but in the recent years, the main driving force of economic growth is from non-oil sector, accounting for an come of 65% of GDP from 2004 to 2008. Real estate is among the important non-oil business sector in UAE which contribute an average of 8% towards the GDP. Abu Dhabi and Dubai are the emirates that contribute major share of GDP, Dubai is playing great role in the growth of non oil sectors, especially real estate market. The impact of real estate sector in UAE economy is high when considering to the last decade, the cities Abu Dhabi nd Dubai became business hubs in Middle East. Real estate sector is remain under pressure in the current economy, muscle contraction is expected as a further drop in property prices as new supply enters to the market along with lower demand and there by widening the supply d emand gap. This will increase in coming years with the completion of ongoing projects will continue to weigh down the property prices and growth prospects. Abu Dhabis current strategy for boosting the housing supply also put redundant pressure on real estate market.Anyway massive investment from government for infrastructure development projects will cause demand for construction and contracting services. Along with this boosting in employment opportunities will expected to provide a base for real estate economy to grow in future. The following table represents evolution of UAE Gross Domestic Product from year 2002 to 2009. Source UAE National power of statistics UAE REAL ESTATE BUSINESS CLASSIFICATIONS For providing statistics more deeply, real estate market further divided in to Commercial and Residential sectors.Commercial real estate sector refers the property which specifically set aside for commercial purposes like industrial use, professional dapples, farming etc. commerc ial property has to keep up with certain standards and should be used solely for business purposes only. Residential real estate involves the sale and rental of land and houses to individuals or families for daily living. some(prenominal) types involve transactions of huge amount and so many regulations are introduced for commercial and residential segments. Commercial real estate market further divided in to office market, retail market, hotel market etc. or providing analysis in further detailed. Residential real estate market Due to current world wide economic conditions and its manifestation, Dubai bought high uncertainty to the residential real estate market which drives down the prices. Residential market of Abu Dhabi and some other emirates are experiencing a shortage of supply, with insufficient homes or villas to meet requirement of current population. So sharing of villas and apartments is common here. In Abu Dhabi itself there is a shortage of 48,400 housing nits, the u pcoming projects will be able to meet only around the half. The under supply for end users is particularly for lower and mid market brackets. The majority of upcoming projects also targets high class investors. Residential sales prices in UAE reached its peak in 2008, at this time rent also very high. Residential rents and selling price continue to decline due to a number of factors. much new supply will be available and as rents decline, many tenants are expected to be trade up from shared accommodations into single accommodation and thereby it keeps increase in demand.Rapid economic growth and employment opportunities results an unprecedented population boom, multi occupancy and sharing will of villas etc makes it possible to meet the requirement. House prices were fallen in last quarter of 2008 and now it lento persist ins an optimum pace. Economic growth, government support and mortgage lenders returning to the market etc are current driving forces of financial strength. The following graph represents the house price changes in UAE for the last three years. In the last quarter of 2010, residential price index rose slightly to 0. %, the total number of property transactions increased around 5%. Office market Currently there is a limited supply of office space in UAE, especially for multinational service sectors which require international standards. unflurried there is shortage of professionally managed office space, so office markets are operating in maximum occupancy rate and rents are relatively high when comparing to other developing countries. When begin a office, organizations will consider many concerns like road and transport facility, resource availability, infrastructure accessibility etc, so rents in areas within the city is very high.Medium background organization mostly prefer near areas of city to get the prefer of relatively less rent. More office space will be available when completing the ongoing projects which will help to stimulate market absorption rate in light of case, tenants got opportunity to occupy high smell office space at a lower cost. As a result poorer quality spaces forced to reduce their price. Large investment from government to set state owned enterprises and banks, currently most of such organization own the space rather than active in rental market.To widen the services of government agencies and enterprises new high quality office spaces should be created in various parts of the country. Foreign investment and multinational company involvement in different sectors like oil and gas, financial services, professional services etc largely influence the current trends in office market. According to the Global Office Market View from CB Richard Ellis (CBRE), UAE is an increasingly affordable and attractive destination for company offices, with growing stability within the emirates.The quality and standard of completed buildings and its affordable rent rate here become much more attractive. Reta il market Retail market in real estate represents floor space available for participating in trades direct to customers. Retail market also faces shortage of international quality projects and so availability of floor space for retailers relative to demand is less. increase spending of both UAE citizen expatriates and the existing below average per capita income provides a good atmosphere for retail market.The total retail supply in Abu Dhabi is almost 1. 4 million square meter of GLA and it is important to note that most of this space is in non mall set up, i. e. street shops. There is significant shortage of available retail space including high end street retail at present and the existing shopping malls are currently having high occupancy rate of nearly 95%. The demand for retail market is expected to increase in coming years also, the emergence of more world class tourism points in UAE also support growth of retail sector.New retailers are offering new retail sales format and experience which will cause an increase in spending of money in retail market. In the growing economy of UAE, average rental rates almost unchanged in the main retail malls of Abu Dhabi emirates but continue to decline in Dubai. Hotel market Dubai is one of favorite phaeton destination for people from Europe and other Asian countries. Abu Dhabi, Fujairah ad other emirates are also emerging as valuable tourism destinations in the country. Luxurious cordial reception and high grade hotels are inevitable to retain in world tourism map.Supply of new hotel facilities are less in last few years after the recession, but it is almost meet the requirement from tourism sector. Occupancy rate has fallen and still act to out perform when comparing to other market areas. Some tourism promotion events like Dubai Shopping Festival, Abu Dhabi F1 Grand Prix, Dubai Air Show, Abu Dhabi shopping feast etc cause some seasonal demand for hotel facilities. The continued expansion of national airline E tihad and Emirates has enabled growth of hotel markets in UAE.Almost half of the total quality hotel supply is managed by international management companies like Hilton, Starwood etc. Development of hospitality sector along with strengthening of corporate market and development of void segment is the main objective of UAE authority and so the upcoming projects will supply the requirements, to continue to increase hotel supply in next few years. Abu Dhabi is one of the strongest performing hotel markets in the last few years as the number of hotel visitors to the city has doubled in from 200 to 2009.In future, hotel market expects big growth along with tourism sector. (Abu Dhabi real estate market forecasts, p19-35) UAE REAL ESTATE LAWS Foreign investors in UAE real estate market face several legal challenges both as to the nature of legal entity to use the properties as well as their ability to acquire free hold interests in real estate. UAE is the federation of seven emirates est ablished in 1971 face of UAE federal law provides legal framework for the emirates.Federal government is entrusted with the task of formulating laws concerning and regulation principal and central aspects of federation including defense, bail, public health, currency etc. federal laws are formulated for regulating labor and social services, real estate and its expropriation in the public interest, agriculture and animal wealth and so on. As per the constitutional principle adopted by UAE nation, local governments in different emirates are authorized to regulate common matters that are not trammel to the federal government.Each of the seven emirates regulates their own affaires by exploring this provision. So, in real estate sector there is no federal property law for politics foreign ownership of real estate in UAE. Each emirates has their own regulations, Dubai is the only emirate currently allow freehold of real estate properties. Federal law of nature no. 5 of 1985 was iss ued Civil Transactions police force and Federal Law No. 11 of 1992 was issued Civil influences Law are the important real estate laws in UAE. Apart from this all the emirates issues their own amendments to protect investors, buyers etc. he civic transaction law later amended by Federal Law No. 1 of 1987 which exclude commercial transactions from being governed by and under the civil transaction law. Different articles of civil transaction law like Article 870, 871, 881 etc ensure the security and dependability of different real estate transactions among persons and banks. As per Civil Procedure code, agreements must be evidenced in writing and must be clearly coiffured. Different emirates made their own amendments for better regulation by using their provision for freely constitute laws.Law No. 7 of 2006 concerning real property registration in the emirate of Dubai is an example of such amendment. Law No. 7 of 1997 concerns the charges for registration of lands, local decree of 1960 concerns the formation of lands committee. Year 2006 amendment define real estate register and different types of rights to hold real estate properties based on clearly defined agreements. As per Article 4, real estate property shall be restricted to UAE and GCC nationals, subject Rulers approval and in specific areas, non nationals grand for freehold ownership.Some other important amendments in Dubai include Law No. 9 of 2009, Law No. 13 of 2008 etc. In 2010, a number of significant changes implemented in UAE real estate laws, to encourage investments and to face challenges from global economic crisis. Landlord and tenant law provide to ensure tenants automatic right for renewal and security of tenure which has existed for the first five years of occupation for both commercial and residential clients. The 5% annual rent increase cap has also been retained in Abu Dhabi to provide middle income affordable housing.Special consideration and laws were implemented in new investment areas like free zones to protect investors rights. Abu Dhabi also formulates framework and general laws for property rights within Abu Dhabi emirates to register property legally. CHALLENGES IN UAE REAL ESTATE SECTOR Rising cost of cement and raw materials is a real challenge in real estate sector. Production of cement in UAE is not enough for satisfy the demand cement comes from outside the country also. The stabilized market and a looming price control intervention by authorities imply that price may not be high always.Real estate and construction industries are lining shortage of skilled labors for construction site. Due to low wages and cloggy duty, many foreign labors leave from here, manpower requirement is high when considering the demand. Delays and cancellations of projects in UAE is a major supply side issue in UAE. Due to global economic crisis, many projects are cancelled due to investors feeling of danger in real estate business. Actually real estate markets are driv en by supply, demand and finance. Mortgage rate is relatively high in UAE when comparing to international standards, especially in Dubai.In many cases, this is beyond affordability. UAE authorities are continuously monitoring to taking deals with these supply issues. (UAE real estate, Reaching New Heights- KFH research P13-14) SWOT ANALYSIS OF UAE REAL ESTATE SECTOR Source KFH research FUTURE harvest-time INFERENCES AND CRITICAL CATALYSTS In general, UAE is undersupplied in relation to the demand for residential, office and retail properties, hotel market almost balance the requirement. Due to high occupancy rate in cities like Abu Dhabi, rental and sales price still higher than the regional market.This has a negative impact on economy there is significant loss of potential employment, spending and investment. The real estate industry has respond to ongoing shortage of quality products, new projects will pull in the shortage in coming years. Years fro 2003 to 2008 is the peak of business, economic crisis caused a down turn in 2009 due to economic crisis. Due to this, major projects are cancelled or delayed, now the country retains its financial strength, significant level of new supply expected to enter in market within two years.Retail and hotel market expected to move into surplus situation within two years. The remarkable growth of UAE real estate sector is enhanced by a number of activities and improvements in basic infrastructure. Many factors will be catalytic force for commercial and residential real estate markets in future. Some of them are Growing employment and population base Due to the success of initiative from UAE authorities to increase Emirati population and to attract expatriates, UAE is now having relatively good labor pool and employment opportunities.Increase in population contributes to the development of economy and promote continuous growth of real estate demand. Promoting company start-up and growth UAE government is taking new ste ps to develop new industries and work culture by introducing free zones and basic infrastructures. Achieving the rapid economic growth also requires substantial developments in to the restrictive framework. Regulatory reform Emirates like Abu Dhabi, Sharjah, Ras- Al-Khaimah etc. still needs to establish a business and legal environment comparable to other developed countries.Transparent regulatory mechanism only can attract investors, especially in real estate sector where a huge amount of investment is required. Transparency In this era of globalization, markets to be more open, transparence of different markets has emerged as a big concern for investors, occupiers and other real estate stakeholders. Marketing benefits from improved transparency tends to be those in which conducting business is easier. UAE need to improve transparency and openness further to keep inline with star international markets.Land Registry Land and property registry system is one of the key element that define transparent real estate market, astir(p) operation of the system by providing public accessibility, improvements will stimulate the additional demand for real estate in the country. (Abu Dhabi real estate market forecasts, p36-37) ? CONCLUSION Real estate refers to residential new homes and existing ones, commercial shopping centers and offices, industrial manufacturing buildings and properties, undeveloped lands and farms etc. Real estate investments are largely influenced by the condition of the immediate area where the property is located.In UAE real estate sector was not much developed as a big business sector till early 90s. Revenue from oil was the main source of economic growth in early stage of the country authoritys dedication enabled them to establish an industry based economy here which helped a lot to develop a real estate market in UAE. Multinational companies found UAE as one of the important business location they began their franchisees which improve opportu nities in residential and commercial real estate market. Real estate market is distinct from other competitive markets, due to the differentiable characteristics and influencing factors.Current supply and demand for real estate properties largely influence the rental and selling price. Residential, office and retail real estate properties still face shortage especially in cities, hotel market currently balance the demand and supply. Elasticity measures the responsiveness of quantity demanded of property goods against change in its price. This is influenced by customers income, availability of alternatives, necessity for the property and so on. Real estate business sector has a remarkable contribution towards UAE economy, nearly 8% of the GDP of the nation is from real estate sector.Because of the global economic crisis, real estate sector also under pressure when it badly affect on business and employment opportunities. Many huge projects were cancelled or delayed due to insecurity feel from investors at the time of recession. But UAE has almost recovered from the impact and now real estate market also expects booming in coming years. Factors like growing employment and population base, promoting company start-up and growth, regulatory reform, transparency etc will act as catalysts for future growth of real estate sector. ? REFERENCES Dr. Eisa Abdelgalil, Badar Aldeen Bakheet, Dubai Real Estate Sector Monitor Series (2007) online www. arabruleoflaw. org/ ingathering/Files/UAE/92. pdf accessed on 22/11/2011 UAE Economic Brief and Outlook 2011 , KAMCO interrogation (April 2011) http//www. menafn. com/updates/research_center/UAE/Economic/kamco130411. pdf accessed on 22/11/2011 Dubai Property Market Overview (Feb 2009), online www. cluttons. com accessed on 23/11/2011 Jones Lang, LaSalle, UAE Retail Market Overview (November 2010) online http//www. dsg. ae/LinkClick. aspx? ileticket=KIYUb_RYXlA%3D&tabid=222 accessed on 23/11/2011 UAE Real Estate Reaching the New Heights, KFH research LTD (September 2008) onlinehttp//www. liquidityhouse. com/ transfer/UAE_Real_Estate_-_12_Sep_08 _1443. pdf accessed on 24/11/2011 Dubai Investment News (28/03/2011), UAE office market is attractive and affordable http//www. thefirstgroup. com/dubai-property-investment-news/article. php? id=800478265 accessed on 24/11/2011 UAE Real Estate Sector Global Research (June 2011) online http//www. globalinv. net/research/UAE-RealEstate-062011. pdf accessed on 24/11/2011