ArabianBusiness.com - Middle East Business News
Wednesday, 03 December 2008 04:47 UAE time

YOUR DIRECTORY /

Print this page Print this page | Email this to a friend Email this to a friend | Discuss this article (7 Comments) |

Dubai real estate risks sharp correction - report

by This email address is being protected from spam bots, you need Javascript enabled to view it  on Sunday, 07 September 2008
DUBAI FLAGSHIP: Property developer Emaar's share price has hit a three year low, while property prices have been rising. (Getty Images)

Dubai's real estate market increasingly faces the chance of a sharp correction as signs of overheating emerge, Saudi Arabian bank Samba said in a report released on Sunday.

"Signs of overheating are emerging, fuelled by expansionary monetary conditions and high oil prices," Samba Financial Group said in the report.

"This is raising the risk that a significant imbalance may develop over the next two years as scheduled new supply comes on to the market, increasing the prospect of a - possibly sharp - market correction."

Shares in Dubai property firms have plunged in recent trading sessions, with the biggest listed firm, Emaar, falling on Sunday by around 8 percent to hit a 3-1/2 year low.

Story continues below
advertisement

Investors have fled the Dubai property sector in recent weeks in the wake of corruption investigations and confusion over visa rules for expatriate homebuyers.

Samba said it expected the sector to enter a cyclical weak phase in 2009-2010.

"Soaring property price increases over the last five years, have attracted increasing supply which will eventually exceed demand," the bank said. (Reuters)

Print Print | Email Email | Discuss this article |


READERS' COMMENTS



Click here to post a comment


Add your Comment
All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic.
Name *
Remember me on this computer
Email *
(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Security Code * Code


Please click post only once - your comment will not be published immediately.


MORE FROM ARABIANBUSINESS.COM

more » MIDDLE EAST MARKETS DATA

1090.SSE

Last Price:

47.60

-2.65-5.27%

2 Dec 2008 12:30 GMT
(Market Closed)

CURRENCY CONVERTOR

RELATED LINKS

  1. Samba Financial Group»

 EMAIL ALERTS

  1. Samba Financial Group

  2. Real Estate



EMIRATES ID DOWNLOAD

READER COMMENTS

  1. Nakheel mulls $15bn IPO move - reports 2
    02 Dec ' 08 at 11:25
    In my view, this about-turn is really making things worse. First they're not affected. Woohoo we're building the world's tallest...  More »
  2. Negative equity, defaults 'now a Dubai reality' 1
    02 Dec ' 08 at 12:02
    I have purchased off plan villas and now I am in negative equity. But I dont need to run. I just refused to pay developer any further...  More »
Read all user comments >

BUSINESS FEATURES

The Russia route

Rajiv Shah went along to find out if the nation looks set to become the next big arena for property investors.

Caught in the trap

With repossessions looming large on the horizon, Alex Delmar-Morgan reports on what the banks need to do.

Prestige properties

Get ready for major communities dedicated to well-being as the region steps on the pampering pedal.

BUSINESS INTERVIEWS

Strength in numbers

Property prices are declining but Mark Stott, CEO of Select Property, is still feeling confident in his company.

Real estate industry at the crossroads

The regional head of the world's largest property services firm on the outlook for local property markets.

Berth boom

Michael Horrigan of IGY Middle East and Europe explains why it's plain sailing for marina developments.

MORE FROM ARABIANBUSINESS.COM