Dubai real estate prices may suffer a fall this year bringing prime property within the reaches of many, but will start moving up before the year is out. On May 17, Bloomberg Business Week reported Bank of America Merrill Lynch having said prices of centrally located property in Dubai will settle down after the recent price drop of approximately 45 percent. Experts predict that prices of residential property in Dubai may fall another 15% before stabilizing. Dubai based analysts have proposed investors that prime assets may soon reach a floor. If we couple these news with that of the IIF expecting an average economic growth of 4.4 percent in the Gulf region this year, then it is safe to assume Dubai real estate prices will hit the floor and swing around in 2010 itself.
The recent crash in Dubai real estate
According to industry reports, most property projects in Dubai suffered a setback following the global credit crisis. The inevitable result was crashing of real estate prices and defaults on payments. The setback of the market economy was closely followed by completion of a wave of constructions that saw supply exceed demand in Dubai real estate.
Another big reason for the dip in Dubai real estate prices were problems facing the government-owned holding company, Dubai World. The slowing of infrastructure development led by Dubai World affected the entire market and most industries, with properties being no exception. According to recent reports of the IIF, the turnaround of Dubai's economy will only happen if Dubai World manages to sort out differences that remain with creditors.
Things have started looking up
The good news is that the real estate scene in Dubai is not as bleak as last year. Dubai Holding, also owned by the government, has already begun financial restructuring. If that is any indication of the efforts of the government, Dubai World, may well be giving finishing touches to its own $ 25 billion restructuring. In fact, according to news reported by Al Bayan on May 17, a government owned properties company has already reopened projects put on hold and is seeking toructure $ 10.5 billion of the debt restructuring of Dubai World.
It's the best time to buy Dubai real estate
Experts are sure that migration within the United Arab Emirates will see residential property in Dubai properties get back in shape. However, it may still take some time for prices to reach the floor. There is still significant over supply of property in the market and the meager 2% rise in real estate prices that happened in the first quarter of 2010 can find it hard to maintain the upward trend. This is especially in face of the fact that a large number of new finished properties are going to enter the Dubai Properties market with projects scheduled to complete by the end of the year.
To sum up, it is safe to say that for any person thinking of buying property in Dubai at bargain rates, 2010 may be "now or never," for prices of Dubai properties will never be lower again.
Source by Nargis Banu