Dubai property market rebounds

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Dubai City Night Panoramic View
Dubai City night panoramic view. Latest industry report suggests Dubai real estate has made a strong comeback as developers start to revive projects once abandoned in the aftermath of global financial crisis. Photo- Daniel Cheong

A market report finds that an estimated 40,000 new homes will be available for buyers in Dubai over the next two years.

Published by consultants Jones Lang LaSalle, the report shows that a number of new properties will be developed between 2013 and 2015, which would account for 11 percent of the 357,000 units envisaged by developers. Those figures suggest that the emirate’s real estate market has made a strong comeback as developers start to revive projects that were abandoned in the aftermath of global financial crisis. After reaching its peak in 2008, property prices fell by as much as 50 percent as investors quickly retreated from the scene.

About 28,000 properties are expected to be completed in 2013. During the first quarter of this year, around 2,200 residential units have already been handed over to buyers. These projects include the Spirit Tower in Dubai Sports City, Lakeside Tower in JLT, Bay Central in Dubai Marina and Al Furjan Villas by Nakheel.

The market rebound has once again fueled fears whether the surge in prices is driven by speculators. In the past, these investors made a quick fortune by buying apartments and villas for cash and then selling them within weeks or days. UAE Central banks had proposed limits on mortgage lending for residential properties to curb speculative buying. However, a final decision on the matter is still pending after a plea by commercial banks.

According to the report; “An initial glance might suggest that many of the conditions that led to the unsustainable growth in real estate prices in Dubai in 2006 and 2007 have returned. The excesses of the last speculative boom will hopefully be replaced by a period of slower but more sustained growth in demand and prices.”

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