Demand to soon outstrip supply for Dubai homes

Discussion in 'Dubai property' started by Harish, Jul 18, 2018.

  1. Harish

    Harish New Member

    As per (moderated) A surge of supply is expected to hit the Dubai residential market in the run-up to 2020. This is a result of the slew of off-plan launches witnessed in the past two years, riding high on incentives offered by developers. However, a concern is being raised in some quarters on how demand will be generated to fill up all this upcoming inventory.

    According to data from Propertyfinder Group, a little over 21,000 units were handed over in Dubai in 2017 and over 10,400 units have been handed over so far this year.

    Going by this, I'm thinking of the scenario after the expo 2020. If the supply is more than demand I don't think it will be an advantage for the Dubai real estate market. It will be interesting to see what steps do the Dubai officials will take after expo 2020.
     
    Last edited by a moderator: Jul 19, 2018
  2. nmb

    nmb Well-Known Member

    The only danger with property developing is trying to read the market potentially years in advance. This is why we often see over supply when the market turns down and under supply on the way up. I would not like to be a huge development company trying to forecast investor sentiment, worldwide issues, local economies, etc.

    Dubai does seem to have bottomed out but last review of the Dubai rental market suggested that rents were softening.
     
  3. Longterminvestor

    Longterminvestor Administrator

    Dubai is a very difficult market to read - I also read that rents in Dubai were softening which does not indicate an increase in property values in my book. How is the underlying economy doing?
     
  4. FWL

    FWL Member

    There may well be a window of opportunity with regards to Dubai real estate if there is going to be a shortfall in available properties and growing demand. However, I find the Dubai real estate market very difficult to read as the last I heard was that rents were “softening” which does not suggest an increase in real estate prices in the short term?
     
  5. Harish

    Harish New Member

    It's true that rents are softening. As we know it's a variable market. we can't predict anything now about an increase/decrease in real estate prices. And I feel World Expo 2020 brings more loss than gain to Dubai real estate
     
  6. Longterminvestor

    Longterminvestor Administrator

    Hi @Harish

    I would be interested to know why you think World Expo 2020 might bring more loss than gain to the Dubai real estate market?
     
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