The Rising Cost of Dubai Properties
There’s no doubt
about it - Dubai
is hot. It’s attracted a lot of attention in the last several years, becoming a
symbol of wealth, luxury, and innovation. Tourists, and those seeking to
relocate, have been flocking there in droves, which led to rapid growth and
rapid increase of property values and prices.
Yet, when
something seems too good to be true, it usually is. Even Dubai, which saw a 79% increase in property
price since January 2007, is now facing a bit of a housing slump. In fact, one
source predicts that property prices will fall by 10% by 2010. Overall, though,
that’s still a gain of nearly 70% in just three years! That’s an incredible
increase by any standards.
So what drives
this increase in price? Several things: good old supply-and-demand, greed, and
escalating costs of construction. Similar to other places in the world, the
high prices of gasoline and oil (originally a boon to Dubai) are now being felt more deeply as
products they need are increasing due to those same high oil prices.
Supply-and-demand
has affected property prices because of that same skyrocketing interest in Dubai mentioned earlier.
It has gained so much attention in the last several years that even they
underestimated how many people would want to invest in their real estate?which
only became available to foreigners in 2002.
Knowing that the
demand is high for their work, some contractors and others with low integrity
are being greedy and inflating prices, trying to make the most off the , and continue to generate interest.
Perhaps they should also spend some time getting to know what happened in Singapore
before the bottom fell out from them!
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Tags: boon, droves, foreigners, gasoline, greed, housing slump, innovation, integrity, last several years, no doubt, oil prices, places in the world, property values, rapid growth, rapid increase, singapore, supply and demand, tourists