Buy Abroad News

14 Jan 10

Little To Smile About For Dubai Property Market as Dubai Investments Makes Statement On The Back Of 09 Results

On the back of almost relentless bad news for the Dubai property market comes a statement from the CEO of Dubai Investments Co, Khalid bin Kalban who stated to Reuters that the firm had made a profit of $81.68m equivalent to AED300m.

However he went on to say “that they were exposed to developers who had taken a big hit from the downward spiral in property prices in Dubai and, If companies have lent to a major developer in the market and that developer is not paying us because of their liquidity issue ... we'll have to prepare the provisions," said Kalban.

The emirate’s, which at one point had an enviable and booming real estate sector came to an abrupt end towards the end of 2008 as developers started to dramatically curb spending by either not starting projects or suspending projects under construction.

Kalban went on to say that the actual default rate was less severe than had been originally expected with the percentage being closer to 20% rather than the predicted 40%.

Real estate professionals generally still see Dubai as a brave place to invest at the moment and buyers in 2010 are likely to be clients who either want a permanent residence or a holiday home, where they are not worried about the possibility of stagnant valuations for the short to medium term.