Real Estate Market Slows Down In Dubai and Here's Why
A leading consultancy firm offers its observations regarding the status of Dubai's property market, according to an article on kippreport.com. JLL Consultants note the following reasons pushed the Middle East city off balance in the real estate market arena, namely the strong UAE currency value, rising inflation and tight property market regulations.
Talking on the subject of inflation, Khurram Ali, Times Real Estate co-founder and partner said,"In the past six months, prices have gone down by over 50 per cent. In terms of the local market, this has affected local investors and countries that rely heavily on their oil reserves. Of course, the currencies have gone down, [so] investors are a little bit more inclined to step back from making any more investments."
"Prices are expected to continue softening over the remainder of the year and into 2016," says JLL, as mentioned in the same article.
In another report on gulfnews.com, Al Madina Al Raeda Real Estate CEO Juwaad Beg says, "This is the stage where any buyer knows you can get the best bargains. There's no rush to buy today because many believe they could get even better deals later on. However, while transaction levels are way down, conversion rates are still healthy at the luxury end. Where there used to be 10 enquiries before and two people buying, these days you still do get the two transactions even if the number of enquiries are less than five."
In addition, the stoppage on delivery of completed homes was another hit on the Dubai property market. JLL reported that "a number of projects initially scheduled for handover in the second-half of 2015 have been delayed to 2016-17, as the market continues to to soften and developers phase projects in line with demand." JLL's Craig Plumb however remains optimistic, stating just a few low sales were occurring.