The United Arab Emirates, including Dubai, have been attracting capital for years thanks to favorable tax conditions and a dynamically developing real estate market. We talked about this market in Business Insider, among others. with Danuta Dunin, an expert from Dubai Broker.
It pointed, for example, to the security of transactions due to a very strict control system. However, geopolitics turned out to be a danger.
As Bloomberg notes, after stagnation that lasted until 2020, prices increased by over 70%. However, according to ValuStrat, the March price decline pushed the index back to the level of six months ago.
The conflict in the region affects the real estate market
When it comes to reasons, there are no surprises. Experts indicate that regional geopolitical tensions, including Iran's retaliation for US and Israeli attacks, have affected the Dubai real estate market.
Read also: Employees escape from Dubai paradise. “I've never seen it this quiet.”
As a result of these actions, the Persian Gulf countries, including the UAE, had to face thousands of missile and drone attacks. Although a tenuous truce was reached in early April, peace talks have failed, further increasing uncertainty in the region.
According to the REIDIN analytical company, the value of apartment sales in Dubai decreased by almost 20% in March, reaching the level of approximately PLN 40 billion. The number of transactions decreased from approx. 16 thousand. up to 13 thousand compared to the previous month. Louis Harding, CEO of the Betterhomes agency, who was quoted by the agency, predicts further easing of prices and a decline in demand, which may result from slower population growth and the completion of many investments.
