The Rising Price of Property in Dubai

When researching a property market for its potential for profit there are a number of incredibly basic but absolutely essential considerations that every investor needs to cover.  These include the current desirability of the location in question and what factors if any will result in continued demand for the location, the current and predicted supply and demand ratio and whether there exists a strong, sustainable and expanding local affordability trend.

When it comes to understanding the factors driving the rising price of property in Dubai and determining whether the property market in the emirate actually has legs to run and run, a number of very interesting facts present themselves…

Property prices in Dubai have been increasing annually ever since it was announced that foreign freehold ownership of real estate in the emirate would become a reality.  This year the new Dubai property laws have been ratified and will be ultimately finalized by the end of the year and the period of speculation has ended in Dubai; there no longer exists risk in the marketplace which has given an already healthy market an extra boost. 

Property buyers and investors who were holding back until the law that was promised was passed are now making their move and forcing property prices ever higher in a location where demand is already outstripping supply.

Demand is also outstripping supply in the rental property market in Dubai meaning that not only are underlying values of property increasing rapidly but so are rental rates and yields.  All of these factors mean that the property market in Dubai is currently healthy…but can the rising price of property in Dubai continue?

This is the question that property investors must ask themselves before making a commitment to the emirate’s real estate sector…

Current opinion on the answer to the question ‘can the rising price of property in Dubai continue?’ is ‘yes’…

The fact of the matter is that property for sale in Dubai is being sold at a far lower price than similarly located and represented real estate in any major capital or commercial city in the world.  At the same time the business and economic climate in Dubai is rapidly improving from month to month as projects such as Dubai Healthcare City, Dubai International Financial Centre and Dubai Multi Commodities Centre begin operations.  More international professionals are relocating to Dubai, they are enjoying ever expanding tax free salaries and the only indications are that affordability in Dubai will expand, demand for property will increase and supply will continue to be limited by the physical speed at which developers can plan and construct and by the actual geographic limitations of Dubai.

All of these factors mean that at the moment Dubai ticks every single essential box and fulfils every single requirement that a property investor needs from a real estate market to make an investment worthwhile and sensible.

Special Reports: Property News for Dubai

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