In Dubai, it's all about timing
The UAE property and mortgage market is booming again, with prospective buyers scrambling to secure home loans before prices rise even higher. And according to CEO of Acrohouse Properties Chandrakant Whabi, now is the best time to buy a home in Dubai - rather than waiting for a correction.
Ambareen Musa, founder and chief executive of Souqalmal.com says the price comparison website has noticed a rise in the number of customers searching for a UAE mortgage through its site - with figures doubling in March. According to her data, the number of UAE mortgage searches on the website has gone up 35% in the first three months of the year. The vast majority of home loan searches were expats looking to buy property in Dubai - probably because prices rose by around 43% last year. Experts have predicted these prices will go on increasing, so much as 40% this year.
While the general sentiment remains positive, the International Monetary Fund has warned again about a potential real estate bubble, cautioning Dubai to implement stronger measures to counter speculation.
Masood Ahmed, director of the IMF's Middle East and Central Asia department, said the Fund had welcomed moves last autumn by Dubai's government and central bank to cool what could become a "speculative increase" but that more was needed.
"Our own view is that these measures are good but if you look at what's happening in the market, it's time to consider stronger measures. Particularly in terms of ways to discourage quick turnaround - what people refer to flipping of real estate in Dubai."
While more measures may be needed to stablise the market, there is a widespread feeling that the current property market resurgence is built on more secure foundations than the last boom, which burst after the financial crisis. A key reason is that the UAE Central Bank has moved to prevent borrowers from overstretching themselves by insisting they make higher minimum down payments to secure their dream home.
Market Insight is aimed at examining the emirate's dynamic market and forecasting industry trends. There is plenty of speculation on the current state of UAE's realty market, most of which remains optimistic. However, it is apparent that certain measures need to be implemented to ensure that Dubai isn't sucked back into a property bubble. Ashok Aram, chief executive of Deutsche Bank in the MENA region, summed it up best: "Dubai's relevance is of being positive in a region with some growth and some risks. If costs move ahead too fast, that won't be good for Dubai."