Dubai prices to fall 20 per cent?

Real estate prices in Dubai could fall another 20 per cent according to the boss of the emirate's largest property developer...

Mohammad Al Abbar, Chairman of Emaar Properties, said he did not envisage huge price falls and they would vary according to location and demand.

He hit out at some doom and gloom predictions that prices would fall steeply in 2009. 'A decline of 60 per cent is illogical. There will be a variation in the per centage of decline based on the location and level of units.

Prices in some areas will fall 10 per cent; in others the decline would reach 30 per cent. On average I expect the decline to reach 20 per cent even if there were some units being sold cheaper because their owners are in dire need for cash,' he said.

He acknowledged that the current global economic downturn is hitting the real estate sector hard and Emaar might have to consider delaying projects if market conditions make it necessary to postpone the sale of new units.

But he said that said Emaar's financial position was strong despite laying off 100 employees and he denied recent reports that it would buy back shares.

'I believe we are finished now with the layoffs and this might be the same for other companies. We do not have financial problems, the financial policy that we have followed over the past years in preserving liquidity despite the pressure we faced at general assemblies from shareholders calling for higher dividend helped the company enjoy a good financial position now,' he explained.

Al Abbar, who also heads the crisis committee set up by the Dubai Government to monitor the global downturn, repeated that demand for real estate in Dubai is likely to outweigh supply this year despite the credit crunch.

Source: www.propertywire.com