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UAE house prices seen falling further 25-30% – Rasmala
By Andy Sambidge
Friday, 11 March 2011 10:04 AM
House prices in the UAE are set to decline a further 25-30 percent this year and next due to a rising oversupply of property, investment bank Rasmala has said in a new report.
Analysts said they saw depopulation risk and supply and demand issues as “Key headwinds” facing the country’s real estate market.
“We believe the UAE property sector is undergoing mid-cycle dynamics; house prices have corrected by 45-55 percent, but rising oversupply could see a further 25-30 percent drop in the next two years,” Rasmala said.
“While supply dynamics may be somewhat different for Dubai and Abu Dhabi in terms of volumes, their demand dynamics almost mirror each other ? a low appetite for new housing as financing remains tight and negative equity concerns linger,” the report added.