Real estate prices in Dubai’s battered property market are bottoming out more than two years after the financial crisis sparked a slump that devastated values, an analyst has said.
Fifteen months on from the Dubai World debt crisis, which saw the state-owned conglomerate seek to alter terms on $24.9bn of debt, investor appetite is picking up, said Saeed Hashmi.
“We’re now a year on from the whole Dubai World situation. We’ve moved on, mature markets have stabilised again. Declines are slowing down, we’re getting close to the bottom of the market,” the head of valuation and advisory at Landmark Advisory said.
The emirate’s housing market has been in decline since 2009. The value of real estate deals in Dubai plunged 65 percent in 2010, data from Jones Lang LaSalle shows, while the number of transactions fell by more than half.
Average house prices in Dubai have tumbled 62 percent from their peak, Deutsche Bank said this month.
Complicating the matter is the threat of new supply, which could further the price slump. As many as 48,000 homes will be completed in the next two years, increasing current supply by 12 percent, Landmark Advisory estimates.
The UAE’s trade and tourism hub may also benefit from the political unrest sweeping the Arab world, as investors seek comparatively safe markets for their funds.
From: Arabian Business