Taking to account a huge even oversupply of new units to the market, and also the fact that major Dubai developers suffered losses in 2019, property prices this year could easily deepen down to another 5 to 10 percent, says S&P Global ratings Report.
This is exactly the level of decline this ratings agency had forecasted last year for 2020. "We are seeing prices approach a level which we saw at the bottom of the previous cycle in 2010-2011, and when you adjust for inflation and
“We are expecting a year of
S&P expects that at least 120,000 new units to enter the Dubai real estate market in the next couple of years. According to real estate insights platform, Property Finder, from the 90,000 units that are scheduled for completion in 2020, the real level of materialization cut this number to no more than 40,000 to 50,000 units to be handed over in Dubai this year.
As imexre.com had previously reported, ValuStrat consultancy, on its part, p
And speaking of the Expo 2020 factor, experts admit that the event could bring a temporary easing to prices and improve market sentiments for a while, but oversupply could become a problem again after 2020, S&P said, noting hospitality and retail sector will suffer the most.
"What is evident is that we have a huge pipeline of deliveries for the next two years. Say 120,000 units are expected in the next couple of years. Presumably, most of them are pre-sold, which means any halt to supply, if at all, will come only after 2022," said Sapna Jagtiani.
As imexre.com has also noted before, Hussain Sajwani, chairman of Dubai’s top developer Damac, recently also said that the emirate’s troubled real estate market will not recover unless developers stop new residential projects at least for two years.
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