Dubai and its amazing property developments came to a standstill in November 2009 when the Government-backed Dubai World Conglomerate issued a statement to the effect that it could not repay its debts of $22 billion.
Crisis discussions are taking place quickly to tackle the huge debt problem and to discover a way to pay it off and enable the stability of Dubai's economy. This has had an impact on the Dubai property market although not necessarily in a negative way. Those who have purchased in the last year, with high property prices and mortgage rates, will have to hold on and wait until the economy settles, as most are likely to have negative equity. Those buyers that bought before 2007 will be safe, and may even make a profit if they chose to sell.
For those investors who have an interest in securing discounted deals in commercial property in Dubai, as well as houses and apartments, and who may have large deposits to put down, now may be the best time to pick up a bargain. Dubai property prices have dropped by as much as 50 percent from the property peak in the latter part of 2008. Some financial, commercial and retail property developments are now on hold or have been cancelled as Dubai makes an effort to stabilise its economy and financial position.
Dubai was racing ahead with a significant number of developments, and there were also attractive visa terms available if they bought a Dubai property. However, the bubble has now burst and the first priority for Dubai is to find a resolution to its current financial crisis and discover a way to move forward and reassure global investors who have already invested heavily in the Dubai property market. Another problem with the Dubai property market, was its oversupply of developments, and the speed at which the development happened. Most of the property purchases were bought speculatively off-plan, and there was a surge in overseas buyers wanting a slice of the Dubai property market. This was an increasingly growing bubble that has now burst.
However, it's not all bad news. Dubai still has a strong tourism and retail industry, and its bid to become one of the world's most important financial centres can still become a reality if they can reassure global markets and companies to stick with them and invest in them. Abu Dhabi's loan has helped to calm nerves, and with other help, over time Dubai can recover. Dubai property is a very attractive deal currently, although purchasers should hold on to see what plans are offered to help Dubai recover.
Author Resource:
Peter writes for Tailored Home who have information and listings for property in Dubai . For more information visit: http://www.tailoredhome.net/OverseasPropertyforSaleinUAE/tabid/1333/Default.aspx
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