Dubai property recovery in 'two years'

The Dubai property market is expected to show signs of recovery in 2011 after a period of stability, according to new research...

The reasearch from Jones Lang Lasalle  indicated that the region's property market had reached a tipping point in the third quarter of last year as a result of the global economic downturn. Dubai, with an economy closely tied to international markets, has been one of the worst affected in the region, but the situation was expected to improve after a phase of consolidation.

"We see 2009 as a year of correction in the Dubai real estate market, with 2010 witnessing market stability ahead of a recovery in rentals and prices in 2011," the report said.

Back to basics

For now, conditions would be tough and firm recommended that developers re-examine their business models and approach to projects.

As developers adopted a "back to basics" approach, a switch from iconic projects was likely to take place, with the focus on much more functional and cost-effective buildings, the report said.

It said fewer speculators would be drawn to the Dubai market, even as it began to offer opportunities for astute investors.

The report added that developers would benefit from a substantial drop in construction costs, which are already 40 per cent lower than the middle of last year. Consumers would also have the advantage of lower rentals and purchase prices.

Source: www.thenational.ae

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