A sense that the worst of the downturn is behind us has resulted in a significant improvement in sentiment about the outlook for real estate markets, according to Jones Lang LaSalle’s Third Real Estate Investor Sentiment Survey.

Ian Ohan, Head of Mena Investment Transactions at Jones Lang LaSalle, said, “Investors are much more positive than they were six months ago. Our previous survey concluded that 2010 was shaping up to be the ‘vintage year’ for real estate investment in the Mena region and our latest report confirms this view.”

While Dubai received high marks from investors for its achievements in world class infrastructure, appeal to international corporate occupiers, market openness and quality of life; investors expect Abu Dhabi, Saudi Arabia and Qatar to recover first.

“Strong fundamentals in the hydro-carbon power-houses of the region will ensure more investor attention in these markets, which are expected to recover most quickly,” according to the survey.

The survey also revealed real estate buyers outnumber sellers on average by 8 per cent. It clearly suggests the hesitation of sellers and the limited availability of investible stock are the major constraints on investment volumes, rather than a real lack of buyers, the survey revealed.

While short-term concerns around liquidity and over-supply remain, a return to 2007 pricing will see Dubai enforce its competitiveness as one of the region’s leading destinations for investment, Ohan concluded.

Key findings:

Dubai will see the biggest improvement albeit in terms of a slow-down in falling asset values.

Abu Dhabi remains the most attractive investment environment of all the major markets in the region

26% respondents believe Middle East will be the best performing market over the next 12 months

All Mena markets are predicted to see better price performance than in the recent past KSA, Abu Dhabi and Qatar will see a return to positive growth.