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Dubai: The Dubai government expects supply from a stream of private and public sector property developments to stem rising property prices in the emirate, a top Dubai government official said on Sunday.
“We should really control the inflation, it’s a matter of supply and demand and if you look at some of the rent today it’s shooting up and I think [control measures] could solve the problem, said Shaikh Ahmed Bin Saeed Al Maktoum, President of Dubai Civil Aviation, Chairman and Chief Executive Emirates airline and Group and Chairman of Dubai’s Supreme Fiscal Committee.
Shaikh Ahmad said the introduction of new supply should help stem the inflation rate, which he said he would like to see at 3.5 to 4 per cent, far lower than current housing growth prices.
“We are really trying to control the inflation rate. We don’t want inflation [to] be so high,” said
Shaikh Ahmad spoke to reporters after he opened property and real estate show Cityscape Global in Dubai. Organisers expect more than 35,000 people to attend this year’s show visiting 250 exhibitors from 28 different countries.
Dubai’s property market has been the topic of much speculation in recent months with analysts and industry executives cautious of market is danger of bursting as the bubble stretches.
According to property experts Knight Frank, housing prices in Dubai in the 12 months ending June were the highest in the world. Dubai’s luxury home market grew by 6.3 per cent in the second quarter; however, the mainstream segment rose 24 per cent year-on-year.
Asked about their outlook, Dubai property industry executive said they were bullish on the market despite speculation of a correction.
“The market over the past few months has given the single that it should stabilise over the next 12 months,” said Saeed Al Qatami, Deyaar Development chief executive.
While Ziad El Chaar, managing director at property developer Damac, said in an interview he believes market sentiment is strong.
“There is real demand in the market,” he said.
Asked if the Dubai government was cautious about the size of debt being taken on to develop some of Dubai’s mega projects, Shaikh Ahmad said “no, the market is there.”
“We always believe Dubai will attract more and more people,” he said.
In July, the Dubai government announced the Dh25 billion Mall of the World project, which will feature a temperature controlled dome, and earlier this month announced the Dh32 billion expansion of Al Maktoum International at Dubai World Central (DWC).
Shaikh Ahmad said financing was not an issue with “so many companies and financial institutions” lining up to finance the airport project.
See this related story: An overview of the Dubai real estate market
Source: Alexander Cornwell, Staff Reporter, gulfnews.com