Real Estate

Dubai City Property Market Cooling
By Simon Tweddle

In Dubai there are now strong indications that the federal government is obtaining some type of grasp on the extras of the Dubai building market - and concerning time too. We have actually viewpoint the marketplace as rather high danger. The market has an uncommon collection of vehicle drivers and is not specifically one of the most transparent place to buy residential or commercial property.

The big quantity of building there unavoidably raises questions concerning surplus, yet seemingly until now demand has overtaken supply.

Rate growth in some parts of Dubai has been reported to be a nearly incredible 79% in 2007, that gets on top of already remarkable growth figures in the previous years. High growth is proceeding in 2008.

Currently in mid-2008 the government is stepping in to manage off-plan purchases, home mortgages and are applying an entire raft of measures to cool down the market. These are most likely to do the work they are intended to do.

Like some of the structures in Dubai the home market has appeared to defy gravity. With high costs and more heavy government treatment I would be much more careful of purchasing Dubai than I have remained in the last couple of years. It remains to be seen where the Dubai building market will certainly head following and whether the Dubai government could really use their oil loan to turn a patch of desert into one of the world's real industrial and economic centres.

Generally, I would certainly avoid Dubai as an investment area, high financial investment returns could be made in other places for a lot lower danger.

Simon Tweddle is Managing Director of a worldwide residential property investment firm based in Prague, Czech Republic. [http://www.propertyinvestmentinternational.com]

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