Interesting area, very buoyant at the moment, but do you really know all about the property market in Dubai?
To say this is an interesting post is an understatement, it sets off as a normal run of the mill pros and cons post but suddenly all of the hidden elements of the Dubai property market come into play and it maybe does not look as straight forward as you might have thought.
It is pointed out on a number of occasions that Dubai has been, and continues to be, one of the few safe havens in the property market at the moment. The area is on the up, oil revenues are flying high and businesses are being attracted to the area in droves bringing with them more and more personnel. But is the property market getting a little over heated? Is it due a correction?
The general consensus seems to be that construction is currently a little ahead of demand and at some stage price rises will start to slow down. However, when you also consider the new companies looking for exposure to the area (US giant Halliburton was mentioned) and the fact that you can affectively buy a visa with your property there is a feeling that demand is not about to start slipping at the moment.
On a more basic level it seems as thought the laws which govern the property market, tenant’s rights, etc, are not as clear as they should be and could see the number of rental disputes increase unless this is addressed.
While Dubai has been one of the darlings of the property market for some time there still seems to be a level of demand currently not seen any where in the world today. The tax regime is very attractive to investors / those who want to move to the area and it seems as though more large corporates are eyeing up a base in Dubai. This has all led to a massive influx of foreign money and a seemingly endless demand for property in the area, even though the property market is fair from cheap.
However, one of the more worrying elements of Dubai is the fact that the laws which govern the property market are fairly vague and open to interpretation in many areas, something which has seen a number of rental disputes of late. There is also an interesting observation about the life of a property in Dubai and the claim that it is only 25 years due to the extreme weather conditions. While this is not something which seems to have been covered in many property sales brochures it may be something to investigate further.
Dubai, like many other areas of the middle east, is riding high on the crest of the oil wave at the moment but even prior to the hike in the oil price it had been attracting growing demand. When you throw in the tourist market in Dubai and the growing number of visitors there is plenty to be positive about in the short term. Whether prices have moved ahead a little too quickly is a different matter although some are looking for a small short term correction as a possible buying opportunity.