Nakheel suspends work on landmark Dubai projects

Posted by: Wajahat Ali Khan Tuesday, 27 January 2009 4:58 PM[UAE] - UAE

I personally don't think so... Besides global financial crises, one of the main reasons for this bubble to burst is the creation of such an environment where Mr. XYZ, earning AED 30,000pm, could actually buy 4 properties, because all he bothered about was the "first two" installment payments, during which time he could easily flip his investment, make thrice the amount he invested, and go out again, searching for the 5th property, because he was not worried about loosing this money which he made on his last sell, and not his 'own' hard earned money... But again, Mr. XYZ is not the only one to be blamed for... Mr. XYZ could go beyond his means only because no developer/bank/real estate mortgage provider did their due diligence on Mr. XYZ as to how much money he has and how much of loan on a consolidated basis he has taken up, how many credit cards' limits he has burst and how many properties he can own... But once again, these financial institutions are not the only ones to be blamed for... because there was no consolidated control/MIS provided by the Central Bank, on individual basis, which could have given the financial institutions an idea to actually guage how much is Mr. XYZ already indebted and how much more loan can he further get, because there is no information available individual borrowing, which are generally, across the world, provided by Central Banks... So again, the bubble burst of Dubai's property market is an outcome of lack of financial checks/controls by the central authority, which is also the real cause of the recent financial crises and property price decline across the globe... However, I do not feel sad about people who have lost their money in heavy property investment, because this downturn has actually wiped off people like Mr. XYZ...

Posted by: Paul Monday, 1 December 2008 5:45 PM[UAE] - UAE

So Nakheel is shelving 'long-dated infrastructure work'... but is still going to go ahead and build a 1.4km tall tower? Of course the tower will never be built because even if Nakheel has lost the plot, the banks have not and will simply not lend on it. But it highlights that these developers have learned NOTHING. Dubai has more than enough gimmicky luxury projects already - super-tall towers, novelty shaped islands, etc. What it has needed all along, but never got, is investment in boring essentials - sewerage, public transport, as well as in low-cost housing. Why doesn't the government tell these developers to stop wasting time and money with ever more absurd schemes and get down to building things that Dubai actually needs. Then maybe, just maybe, people might regain the confidence to actually view Dubai as somewhere with a secure future, instead of as somewhere with infrastructure of the 3rd world that is at the point of collapse.

Posted by: sid Monday, 1 December 2008 9:32 AM[UAE]

I am a property owner in the UAE, both finished and under construction. I am very happy with the current situation of all sales being on hold and new projects being delayed/canceled. I think in the long run it will be good for people who are committed to this market and are not here just to flip. This will certainly make for a more sensible Real Estate market environment.

Posted by: Paul King Sunday, 30 November 2008 9:06 PM[UAE] - UAE

The Dubai real estate market hitting a brick wall is all down to the global financial crisis! It's nothing to do with the garbage quality of the product or the massively high prices. It's all due to the global financial crisis! What a joke! This correction is due to Mr. Market sobering up!