Dubai Inflation Down on Drop in Property Rents |
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DUBAI - Dubai has recorded a significant drop in inflation rate as it is reduced to 5.4 per cent during January to May this year mainly because of a sharp fall in property rents, a top Dubai government official said.
While during the first five months of 2008 it was 8.7 per cent, the head of Dubai Statistics Center, or DCS, was quoted as saying on Saturday.
Rental prices for residential units rose 3.2 per cent in the first five months, compared to a 5.4 per cent increase in the same period last year, Arif Obaid Al-Muhairi was quoted as saying in a report appeared in local media.
Rents in Dubai have at least doubled during a building boom that came to an end late last year after the global financial crisis and oil prices dropped off peaks of $147 a barrel last July.
Last month, the UAE's central bankcentral bank
governor said a rapid price fall in the country, which saw inflation drop to 1.9 per cent in April, would not lead to deflation. With its revised growth estimates, Morgan Stanley last month predicted that the UAE economy to shrink this year. The International Monetary Fund has forecast the economy to shrink by 0.6 per cent in 2009, while another investment bank, EFG-Hermes, has estimated an annual decline of 1.7 per cent. Swiss bank Credit Suisse expects the economy to contract by 2.5 per cent. ?
By Staff Report
© Khaleej Times 2009
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It took a global recession to bring down pricing in this market.
Though there is plenty of talk from experts on the Market bottoming out it should be fairly obvious that the drop in rents will continue till at least Dec. this year. Prices follow market factors such as Demand and supply ...not so called research studies from either banks or property houses which are at best selfserving or leastways a knejerk reaction.
Let whatever it takes happen !......if it can enable each and everyone get a comfortable Roof over their heads that is affordable and fair. [Report Abuse | Email to a Friend | Reply to this Comment]
In reality, the rents are falling and in some cases even by 60%. Every broker knows about it. In many residential areas you can see the To-Let boards as a normal feature on every building and if pationt enough you may get a best deal . I think next quarter report my reflect this scenario. [Report Abuse | Email to a Friend | Reply to this Comment]
Given that the local real estate market is experiencing a boom in relocation as rents are down 20-50% on a year ago this piece of statistical information should be treated with some care. Rents are most certainly not rising as any agent will confirm. [Report Abuse | Email to a Friend | Reply to this Comment]