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Dubai property prices may fall further

Dubai property prices may fall further

A report by Standard Chartered also says that the first signs of stabilization have appeared.

June 9, 2009 3:33 by



Standard Chartered bank says signs of stabilization in Dubai’s property market are encouraging, but further falls cannot be ruled out and should even be welcomed, reports Arabian Business.

“After a fall of 30 to 40 percent … the first signs of stabilization in Dubai’s real estate sector have appeared, taking observers by surprise since further declines were expected,” said analyst Philippe Dauba-Pantanacce. “Some caution is warranted, as there are still question marks surrounding population flows in the coming months,” he added.

Real estate prices in Dubai may also have to avoid a return to earlier levels if the city is to compete with global hubs such as New York, London and Singapore, the bank said in the report.

In a survey of the world’s most expensive office markets by CB Richard Ellis last year, Dubai ranked seventh worldwide, ahead of London, Paris, Singapore, and New York. “This does not accurately reflect these cities’ comparative advantages, demographic pressures, and physical constraints relative to Dubai’s,” said Dauba-Pantanacce. “Thus, Dubai’s real-estate market needed to become better-aligned with its intrinsic value.”

A report published by London-based Knight Frank in May said that Dubai’s property prices fell by 32 percent from March 2008 to March 2009, making Dubai the world’s second worst performing property market after Latvia.

However, late last month, HSBC released a survey saying property prices in Dubai and Abu Dhabi are picking up, with prices rising by 4 percent in April and 5 percent in May.

The market may be on the mend, said David Lepper, head of UAE equity research at HSBC. “Market data from April and May show a range of positive indicators: agreed property sale prices are rising, volumes are holding up well, and banks have loosened their lending criteria.”

“We will not be able to discern a sustainable trend until later in 2009,” the bank added, however. “And while we note these positive developments, the market as a whole is coming off a very low base, given the sharp declines since the market peak. Credit growth remains subdued, and the UAE economy still has challenges to deal with.”

Despite so many research reports, we are still really confused about where the Dubai property market is headed. Has it reached the bottom, will it sink lower, or is it on its way up?



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4 Comments

  1. Dubai Property on September 8, 2009 10:40 am

    Dubai property market was once the hottest in the world.

    Industry analysts told Emirates Business that………….

    Dubai real estate market may see further drop in prices as most properties are still overpriced and the occurrence of real recovery remains difficult to predict.

     
  2. Dubai Properties on September 22, 2009 2:22 am

    Great writing – thx for a lot of Dubai advice.

     
  3. Arcus Properties on November 24, 2009 1:46 pm

    It is true that Dubai Real Estate Market is currently suffering due to no more investors interest.

    Many Dubai property investors are reported to be struggling to make their payments and this has resulted in falling property prices.

     
  4. Maria Emile on December 7, 2009 7:04 am

    The Dubai market is really suffering in these days the reason behind this is the recent world slump and the wars which have really disturbed the world’s every country economy the survival from these situations seems impossible. But the Dubai Govt. Have assured the creditors that the market condition and loans will be repaid within six months.

    http://www.bayut.com/news.php

     

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