# Property Market 2008-2012



## telecompro (Apr 4, 2013)

Hi Guys

Just trying to find some info the property market in Dubai and when was the peak and the lows for the past 5- 6 years? Any idea where we are in this cycle for the next coming years? I believe we are heading in the same direction sometime around but it would not be the same burst as it is abit more controlled now.

If you were in Dubai at that point of time, what was highest price of a 2 bedroom for example and at the crash time - how much would the same property be?

Please share your insights and views for all the people who were living in Dubai at the time 

Thanks


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## telecompro (Apr 4, 2013)

Wow - i researched and found some info on this which are shocking prices :O

In the Greens, the rental index places the annual rent of 2BR apartments between AED168,000 (US$45,777) and AED180,000 (US$49,046), and 3-BR apartments at a range of AED200,000 (US$54,496) to AED260,000 (US$70,845). In the Arabian Ranches, rents for 4-BR villas vary between AED320,000 (US$87,193) and AED350,000 (US$95,368).

In Jumeira Lake Towers, 3-BR apartments cost between AED240,000 (US$65,395) to AED350,000 (US$95,368). In Marina, 3-BR apartments vary from AED220,000 (US$59,946) to AED300,000 (US$81,744). In Mankool, 3-BR flats rent for AED150,000 (US$40,872) to AED200,000 (US$54,496) annually.


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## Felixtoo2 (Jan 16, 2009)

Yep, 2008 was pretty much the peak and we are almost back up there now. The main difference back then was that a lot of the Marina and JLT wasn't finished or even started so there was less supply. 
Hopefully another crash will come along to help sort out the situation we have now which is largely caused by greedy landlords and sycophantic estate agents who are on no deal no pay contracts.


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## telecompro (Apr 4, 2013)

Felixtoo2 said:


> Yep, 2008 was pretty much the peak and we are almost back up there now. The main difference back then was that a lot of the Marina and JLT wasn't finished or even started so there was less supply.
> Hopefully another crash will come along to help sort out the situation we have now which is largely caused by greedy landlords and sycophantic estate agents who are on no deal no pay contracts.


Now that scares me  as i also have second thinking of buying property here instead of the rent money going to waste like this:frusty:


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## xxxxxxxxxxxxxxxxxStewartC (Mar 3, 2012)

It's crazy to buy property here, in a virtually unregulated environment, and with increasing instability in the region.


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## TallyHo (Aug 21, 2011)

In 2008 JBR was the most popular apartment complex in the Marina, largely because better buildings hadn't finished yet.

I remember the sharp escalation in rent in the fall of 2008. In August asking rent for a 3 bed in JBR averaged around 240,000 and reached 300,000 by December. 

One beds in bog standard blocks in Al Barsha were asking 90,000.

The cheapest 1 bed in Dubai was in International City and they were asking 65,000.

Then the market crashed. It was an astonishing time to live through.


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## Felixtoo2 (Jan 16, 2009)

Although on paper it looks like it makes complete sense to buy here there is no way I'd even consider it. As mentioned above there is just no stability and the banks can change their mortgage deals at the drop if a hat. 
Apart from that living here is not guaranteed either, if you upset the wrong person, get on the wrong side of a car accident, get picked up drinking without a drinks licence or accused of something you haven't done you can be on your way outta here rather quickly.


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## telecompro (Apr 4, 2013)

TallyHo said:


> In 2008 JBR was the most popular apartment complex in the Marina, largely because better buildings hadn't finished yet.
> 
> I remember the sharp escalation in rent in the fall of 2008. In August asking rent for a 3 bed in JBR averaged around 240,000 and reached 300,000 by December.
> 
> ...


To be honest i dont think this burst will happen again as its abit more controlled now and they are trying to avoid this from happening. It has nothing to do with Expo 2020 like everyone says.

I was hearing this morning on the radio dubaieye that rents have gone down in a number if areas such as downtown and marina which is a good sign as they are trying to stabilize the market and avoid any upturns..

http://www.emirates247.com/business...-villa-rents-are-dropping-2014-09-03-1.561618


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## TallyHo (Aug 21, 2011)

That's what they said the last time. We had a brief period of stability then it utterly and completely bottomed out. It took two years to reach rock bottom.

I do agree we won't see the same drastic fall. The question is how much?



telecompro said:


> To be honest i dont think this burst will happen again as its abit more controlled now and they are trying to avoid this from happening. It has nothing to do with Expo 2020 like everyone says.
> 
> I was hearing this morning on the radio dubaieye that rents have gone down in a number if areas such as downtown and marina which is a good sign as they are trying to stabilize the market and avoid any upturns..
> 
> Latest Rera index reveals where Dubai villa rents are dropping - Emirates 24/7


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## haibinhle (Jun 1, 2013)

I'm living in Silicon Oasis, my current appt that I rent was bought at 1.2M Dhs in 2008-2009. It is now at the price of around 650k-700k! a drastic drop in price.


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## Stevesolar (Dec 21, 2012)

Hi,
I think the decision to purchase a property in Dubai completely depends on your country of origin and source of funds.
If you come from a normally relatively stable country - UK, USA, france, Germany etc. and you are a normal wage earner then to buy here is a huge risk.
If you come from a less stable environment like Pakistan, Egypt, Russia, Syria, Iraq etc. and you have a stash of money - then it makes perfect sense to bring that money in a suitcase to Dubai, buy a property and then rent it to expats and gain a legitimate income here for the next x years.
In the UK, for instance - you buy a property on freehold basis and it can then remain in your family forever and can be passed down to each generation with their wills.
In Dubai - expats can only buy leasehold and i cant see many of the buildings still standing in 50 years let alone the ability to pass them down to future geneations due to legal reasons.
Properties here age much faster than in UK - due to the climate, original build quality and materials used - a bit like dog years!
A 5 year old property here is like a 35 year old property in the UK!
Cheers
Steve


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## TallyHo (Aug 21, 2011)

True. It's impressive to to see the wear and tear in buildings that are only a few years old. Even Emaar isn't exempt.

People are already rehabbing villas in the Meadows/Springs and they're just barely ten years old!



Stevesolar said:


> Properties here age much faster than in UK - due to the climate, original build quality and materials used - a bit like dog years!
> A 5 year old property here is like a 35 year old property in the UK!
> Cheers
> Steve


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## elbanquieroloco (Sep 15, 2014)

Hi Steve,

I'm not sure what you meant by expats can only buy leasehold in Dubai. I thought it was just the opposite, i.e. freehold property was granted for foreigner, that caused the massive take off in the dubai real estate market??

Cheers

Emmanuel



Stevesolar said:


> Hi,
> 
> In Dubai - expats can only buy leasehold and i cant see many of the buildings still standing in 50 years let alone the ability to pass them down to future geneations due to legal reasons.
> 
> Steve


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## ash_ak (Jan 22, 2011)

At the beginning of 2013, in Jumeirah Park, 3 bedrooms were available for 2.2 million aed onwards, now the project is finished and the cheapest 3 br is 4.1 million. Lot of people are complaining about lack of promised parks and poor construction. 

I wouldn't invest in dubai, specially now and definitely not for the long term. Current prices are high and need to fall atleast 30% for me to even consider.


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## TallyHo (Aug 21, 2011)

It's a little murky.

The original "freehold" properties were actually sold on 100 year leases. Sort of similar to the once prevalent system of buying leasehold properties in London. If you bought off plan in 2000, and sold that property in 2010, there's technically only 90 years left on that lease.

Subsequent properties in the freehold areas that were released for sale apparently do not have the 100 year clause. So it's not clear to me whether those properties are in perpetuity or still considered by the Dubai Municipality to be leaseholds for 100 years. It's one of many murky details surrounding property ownership in the UAE.

The UAE government can, at any time, revoke any private property ownership for expats. I doubt they will do it but that power is still there because we aren't and will never be citizens.



elbanquieroloco said:


> Hi Steve,
> 
> I'm not sure what you meant by expats can only buy leasehold in Dubai. I thought it was just the opposite, i.e. freehold property was granted for foreigner, that caused the massive take off in the dubai real estate market??
> 
> ...


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## Kawasutra (May 2, 2011)

I remember in 2007 every one recommended me to by a property instead of wasting money into rent. Especially the real estate agent said there is no burst in sight and it will go on in the next years. Iit was a money making machine and people were forced into it by greed.
But one year later the financial crisis rolled over the UAE and the prices droped in some areas to almost 70% of the initial value.
When I considered the value for money in 2007 it was clear to me that something is wrong on the property market and the prices have been based only on speculation.
No way for me to buy something nor to go to finance something.
People lost their jobs, the value of the property fell by 50% and the only way out of it was the airport.
Human nature is still the same and greed or the pretending of it brought it back, I wish everybody good luck.

Cheers!
lane:


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## Mr Rossi (May 16, 2009)

Never really understood this notion of rent being dead money. I buy a pint of milk, put it on my cornflakes and am done with it. I don't look into how to go about acquiring a cow because the dairy is earning revenue from the supply chain.

In the 80's UK, home ownership was divisive strategy used by the govt of the time to enslave the upper working and middle classes. It worked too, 35 years on and people talk about getting on "the housing ladder", when in fact the plight of Sisyphus is a more accurate analogy.

There's nothing wrong with being financially astute and doing what's best for yourself, and there's certainly nothing wrong with nesting and your own home comforts. Given the state of the financial markets and the proven incompetence of practitioners within, they're even nothing wrong with property as a investment.

However, as you say, greed and stupidity seems to prevail over circumstantial logic and foresight.


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## jgw99 (May 26, 2014)

Mr Rossi said:


> Never really understood this notion of rent being dead money. I buy a pint of milk, put it on my cornflakes and am done with it. I don't look into how to go about acquiring a cow because the dairy is earning revenue from the supply chain.
> 
> In the 80's UK, home ownership was divisive strategy used by the govt of the time to enslave the upper working and middle classes. It worked too, 35 years on and people talk about getting on "the housing ladder", when in fact the plight of Sisyphus is a more accurate analogy.
> 
> ...


In the US, it was one of the pillars of the "American Dream". A term used by the ultra wealthy/elite class to market homeownership to families as being an "achievement".

"Homeownership Is Still the Cornerstone of the American Dream"

Well, let's see. Most US states are broke and unlike the Federal gov't, they can't print $$. Property taxes are on the rise. If you bought anytime from 2000-2007, you're still way deep in the hole. Thank Bernanke for at least being able to refinance (whether this regime causes another bubble is another topic)

After the 20 year in the making bubble that burst in 2008(thank the great Alan Greenspan for that) it's more like a nightmare to a lot of folks including my close relatives.


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## TallyHo (Aug 21, 2011)

I'm a property owner and it has certainly benefited me. Then again I bought in London eleven years ago (admittedly with some help from the family) and the property is worth far more than what I paid. Double, actually. It's rented out and the rent more than covered the mortgage, which is almost completely paid off. 

But that is London. Different story.

I agree that property ownership has many cons that many people don't realise. If you look at what you pay for the privilege of ownership over the years, it's shockingly high. The typical buyer spends far more on the interest on the mortgage than the original cost of the property and when you think about it, it is a massive transfer of wealth. Then you have the wear and tear and maintenance and upkeep. 

The advantage, however, is that it's a system of forced savings. You stick with your property long enough you do build up equity that you otherwise would have spent on rent, which is gone forever. It's too easy to say that one should rent and invest the rest of their money, because most people can't do both. And it encourages stability and investment in the property and local community. But in these days of a highly mobile workforce and unstable economic conditions, property ownership can be a real burden for many people. The continental attitude towards property is much more balanced and people in the UK are too obsessed with it.


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