An Insight into Dubai Property Present Situation

After reading news about Dubai and present situation of Property and real estate industry, one feels that Dubai Property business is at cross roads at present as conflicting news are coming from Dubai. On one side it is being said that Dubai rents are declining sharply and on other side, news are coming that a rise of up to 8% has been observed in the prices of apartments in Dubai following a rise in prices of villas in Dubai as well. So what is the actual situation going on over there right now??

There is no doubt in it that Dubai is going through a huge economic, financial and real estate crisis which is obviously the worst of its kind in the history of Dubai but whether this crisis and depression is to last for a long or is there any hope that Dubai would succeed in recovering to its previous position where it was in 2006.

On the Bright Side:

To counteract the conflicting news about Dubai, there comes the report of profits of Emaar Properties which is among the biggest real estate and construction companies in Dubai and it has announced a profit of about $178 Million for its 3^rd quarter. Another positive news announced by Standard Chartered Bank recently is that there is massive increase in growth of small and medium sized enterprises and their contribution in overall GDP of Dubai is increasing constantly which is really important for such a state which is heavily dependent on Oil reserves and Real Estate industry to run its economy. Also there is another news of increase of about 19.5% through Dubai International airport and which is clear evidence that Dubai tourist industry is expanding rapidly and Dubai (also know as Switzerland of Asia) is taking the form of a tourist hub in Middle East. Construction of buildings like Burj Dubai which is followed by another tallest tower “NakheelTower” would help Dubai economy to recover to its previous position of 2006.

On the Other Side:

The other side of the picture must also be considered and truly speaking, the biggest problem faced by Dubai real estate today is the oversupply in real estate industry. Also Dubai is currently facing the crisis of reduction in population which is making the situation even worse and there is an excess of villas and apartments which are mostly empty and it is expected that this oversupply would be manageable until 2015. Also due to the recent fall in real estate properties in Dubai, investors have lost their confidence in Dubai real estate industry and it would take a bit long time to recover their confidence.

By discussing this overall current situation of Dubai, it is being said by real estate experts over there that though Dubai is currently going through crisis and it would take it 2-3 more years to get out of this crisis but eventually prices have to go up in the end. As far as renting is concerned, Dubai is still a great place for renting luxury offices at very cheap prices and it is a great opportunity for international companies which don’t have their offices in Dubai yet. And regarding purchase of a property in Dubai, it would be too much beneficial if one is thinking to invest in Dubai for long term period as prices in Dubai are almost at bottom and it would take a bit long time for them to recover again. Therefore, investing in Dubai for short term period is not a good idea but investing for long term is expected to have remarkable benefits for property investors in future and for those, this piece of land can bring benefits which no other place in the world can’t, right now.