Property located in the UAE has been on an upswing over the last decade led by the Dubai property market that was born out of nowhere and hit incredible heights but then crash and burn desert safari tour. Many of the so-called experts in the field of property have been pushing UAE property market higher and higher. And even before the economic crisis in the world began there were those who believed the area was shielded from the chaos. They were so wrong!
The Dubai market for property
Although Abu Dhabi has more prominence and more power in the area, it was the Dubai real estate market that caught an interest from investors and the financial press during the last decade. This was a market which was able to grow rapidly from a low level and then continued to grow with the growth of overseas investment and demand continued to mushroom. Although some experts expressed concern about the speed of growth and the level of property prices in the region, investors continued to throw money into the industry.
The global economic downturn began to bite in the US, Europe, the UK and the Far East we saw many former investors in the UAE property market repatriate their money to compensate for the losses elsewhere. The small amount of buyers quickly turned into the size of a tsunami that caused a dramatic reduction in prices, which put stress upon the banking system of the region, and led to Dubai authorities with a huge debt pile. Dubai authorities with an enormous amount of debt.
UAE property in the near future
As we mentioned above, Dubai tends to get most of the world's financial headlines in the press , even though Abu Dhabi is more influential within the region. It's not right to claim that the prices of property have not fallen across-the-board but in actual fact, the Dubai property market pushed further ahead than any other in the UAE and, in the end, continued to drop. Prices in Abu Dhabi have performed much better than the ones in Dubai and, in fact, we are beginning to see evidence of an international increasing demand for UAE property.
The Dubai authorities made a lot of serious errors of judgement while the Dubai economy as well as the Dubai real estate market in particular were flying high. They continued to invest substantial sums of money at times when the demand began to fall and investors were beginning to repatriate their funds. The truth is that Abu Dhabi authorities were Abu Dhabi authorities were forced to take over the Dubai authorities simply to prevent further decline and to prevent a decline in confidence within the region.
Conclusion
The Dubai property market will in the years to come, create an ideal blueprint for what is known as a "property bubble" whereby investors were enticed by the possibility of profit and ignoring the huge increase in prices and subdued demand. In a similar fashion to King Canute and his efforts to repress the sea the sea, some investors in Dubai even suggested that the region will not be impacted by the worldwide economic slump and would continue to attract overseas investment
The market for property in the UAE has begun to steady with signs of increased interest coming from overseas firms and investors from abroad. The extent to which we'll see rise and fall, at speeds reminiscent of that of Dubai property market in the future , remains to be determined because many investors have had their fingers burnt and will be more careful this time.