Dubai is having an expanding economy in trade and tourism. Dubai is having well designed and planned communities as in every community you will find supermarkets, shopping malls, parks, cinema halls, etc. which is making Dubai areas one of the best family-friendly neighborhoods. Dubai is one of the cleanest cities in the world. Basic Infrastructure of Dubai is also great with the best healthcare, educational and recreational facilities. Read about Real Estate Market of Dubai below.
Even all the areas of Dubai are well connected and covered with the public transportation network. And most importantly Dubai is one of the most secure cities to live in the world. As we all know, Dubai police are famous for maintaining the Law and Order of the city. There are also laws like no property tax and many more laws in Dubai related to real estate which one can consult through Law Firms in Dubai can also be one of the reasons for real estate investment.
Reason for Downfall:
Despite all this, there has been a downfall in the Real estate market in Dubai since mid-2013 and the worst year for the market are 2015 & 2016. The main reasons for the downfall are the drop in oil price, an increase in Dirham cost, an oversupply of property and mortgage cap which was introduced in 2013. Oil is the primary export product of Dubai, so the downfall in the price of oil affected the market negatively.
There is an increase in the amount of Dirham which makes it expensive to buy real estate for investors from India, China, Pakistan, and the UK. India and Pakistan are the second and fourth investors in Dubai. Previously developers are mainly focusing on high-end and Luxury Residential Apartments in Dubai rather than focusing on affordable residential houses. Mortgage cap which was introduced in 2013 is one of the main reasons for the downfall in the real estate market as in this real estate law in dubai which limits loan-to-value (LTV) rates for expats to 75 percent.
How does the market try to grow?
Dubai’s economy is weak, but there is little growth in the market of 1.94% in 2018. According to the government, there will be an increase to around 3.8% in 2020. The main reasons for the growing demand and supply trends in the market are the emirate’s 50-year plan and the Dubai Expo 2020. There are approximately 25 million visitors in Expo 2020, which can cause long term residencies and even boost the real estate market in upcoming years. Real estate developers can even consult Professional Lawyers in Dubai as they can help developers with documents and all legal advice which can also lead to their growth.