A hard fall in prices may follow the highest shoot in Dubai housing market

Dubai - real estate economy is one of the hottest investments, and not just owing to its desert atmosphere. The city’s real estate sector has seen remarkable development since 2002, when the Dubai government first declared that overseas would be legally allowed to obtain freehold residential titles for nominated areas. When that pledge came to execution in 2006, a massive wave of investment in Dubai economy ensued.

The high ratio of appreciation in UAE market economy values has moved up concerns that a bubble has been twisted. From 2003 to 2007, new lodge prices rose at an average of 226 % over 4 years, and apartment value rose by an average of 100 % over four years, as reported by Colliers statistics in Dubai economic predictions report.
Rent charges have also risen at their  highest with yearly addition to ranging from 25 to 40 % leading up to 2006, as reported by an Arab investment company EFG-Hermes’ in their report related to economy trends in Dubai.
The government has since obligated caps on rental price boosts, which have been gradually decreased: from 15 % in 2006 to 7 % in 2007, and most lately to 5 % in previous year for renters who have tenanted their homes for two years; and this causes bubbles in economic growth in Dubai, which ultimately results in Dubai economic crisis.