Dubai property market has shown good numbers in 2013 as compared to the previous few years. It can be attributed to the strong recovery of the sector from the 2008 property crash with all segments chipping in to give a solid and strong base helping it to stand back on its feet. In 2008 the property bubble burst had a huge impact on prices and they dropped to almost 65%. The government is taking calculated measures this time and is implementing rules and regulations at a moderate level so that there is no repeat of property bubble again.
The fact the makes it difficult for the government to control the market is that almost 70% of the transactions are made in the form of cash. As Dubai's property market makes a stable recovery experts remain optimistic that due to calculated measures taken by the government there will be no repeat of the property bubble. Developments like Arabian Ranches, Dubai Marina, Palm Jumeirah, Burj Downtown Dubai etc have shown tremendous increase in property value during last few years as they are the hottest real estate locations in Dubai.
Things are looking good for 2014 and the real estate market is looking stable for next couple of months, even though the growth is not that substantial to create an economic boom this year. The trends that are being observed in the market are somewhat encouraging. Investors' confidence is returning back in to Dubai market. Similar upturn however is not expected for the neighboring Abu Dhabi market. The factors influencing the market are stable growth in the economy, a safe environment for investors, large number of job opportunities, large number of development projects announced and improved rental and sales laws.
But there are factors that hamper the rate of growth like the limited availability of bank loans, IPO bonds and sales that are off plan. Therefore much of the funding comes from overseas investment and private funding.
Oriental markets of China and Korea seem much interested in investment this year as they eye many large projects in 2014. The increased foreign interest indicates good news for buyers and tenants but it can also raise speculation of the much feared property bubble.
The occupants of Dubai properties will see new rent caps being introduced in 2014. This ensures the best practices being applied when renting or buying and strengthens buyers and renter's confidence in the property market. The green initiative will also play a part as 2014 will see more Green Buildings in Dubai.
Mortgage caps and stimulus packages are some of the initiatives that UAE government will be using in trying to control the market. These factors show that the authorities are observant of the various trends that influence the Dubai property market so they are taking each step very cautiously as they want to continue the boom era but at the same time don't want the upraise to trigger another property bubble.