So Is It The Right Time To Buy In Dubai?

With prices having dropped as much as 40% on some of Dubai’s most expensive freehold real estate projects, and with the property market over also having dipped where does this leave those who need to buy a home here are those still interested in purchasing Dubai real estate? After all, now buyers are not just contending with property prices going down. Developers are letting people go, and not just the small ones, and projects and developments are being canceled or held back, and again this isn’t just affecting small projects. With major freehold developments like The Palm Jebel Ali and the Dubai Waterfront included in the casualty list of projects that may or may not be going ahead, confidence in off plan Dubai properties has reached an all time low. Whereas before it was off plan property where speculators made all their money, now potential returns are much lower, and the risks are now much much greater. With so many development and real estate companies affected by both the global financial crisis plus the downturn in the local property market there is now large question marks over purchasing off plan property.

So what of the secondary market? Does this provide a more satisfactory and reliable purchase option? Well as previously mentioned the biggest and most popular developments have seen prices drops in the region on 40% in the past few months, so the initial signs are not encouraging. However previously the same developments also witnessed price increases of 200% in record time, something many suspected was mainly due to property speculators not actual demand. So although 40% price drops in such a quick time might seem worrying, when taken into context of the overall prices changes it is not actually that large a correction.

And then consider not all areas of the market are seeing such price drops, and there is some light amongst the gloom for those looking to purchase Dubai property now. With some Dubai villas costing in the millions there was only so long before the bubble burst on those investors purely interested in speculation and making a quick profit. The positives of the current real estate market problems are that there may now be a few bargains around as people try to exit the market. Therefore those wishing to purchase now could pick up a freehold Dubai apartment at a good price, and a price that will no doubt increase overtime. Sure it won’t appreciate as quickly as seen in the past, but with demand still predicted to outstrip supply, Dubai property still looks undervalued in the long term.          
 

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