Dubai Property Bubble Fears High
New laws from Dubai Land Department reducing speculation; new offer supporting maintain beliefs down.
"New laws from the Dubai Land Department are aimed at minimizing speculation, while fresh offer is helping maintain ideals down," the US-based investment bank stated.
Property costs are 36 percent below their 2008 peak despite climbing by about a third from a low in the next quarter of 2011, bank professionals added.
Standard Chartered stated in September that despite prices rising, Dubai's property market was not proceeding towards another crash along with the marketplace was more lasting, determined by an improved economy as an alternative to speculation.
Although the UK-based Knight Frank stated property costs and rents in Dubai have risen at the quickest speed on earth, Jones Lang LaSalle reported last month thin the price of increase (cost and hire) will slow-down over the succeeding 12 to 24 weeks.
The Dubai Land Department has taken steps to decrease turning in the marketplace by increasing registration fees to four per cent from two per cent from Oct 6 with Director-General Sultan Butti bin Mejrin emphasising the transfer would not have any negative effect on the marketplace.
7 noted developers need to give a 20 per cent construction guarantee and make 100 per cent property transaction before launching any new project.
"No project in Dubai is launched without a building assure," Real Estate Regulating Agency CEO Marwan bin Ghalita had advised this web site.
Once we raised the problem on how designers attempting to sell off strategy would complete their job, he said: "Those selling off plan have put a 20 per cent guarantee as security and they're not being allowed to use funds from the trust (escrow) accounts until 30 percent of building is reached."
The UAE Central Bank's new mortgage legislation is forecast to be revealed before year end, which Goldman Sachs experts feel can help cool the marketplace.
Funds remained the king in Dubai's realty industry in the first half. Almost 80 per cent of flats were purchased by cash purchasers.
Politics balance and high rental returns continue to drive Dubai appeal to investors.
Earlier, Knight Frank said increasing expatriate people had caused "great" rental returns for investors with net produces between four and six per cent. For more information on the cloudy situation around Dubai real estate market click to find out more on Dubai property for sale
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