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Oversupply in Dubai real estate to ‘take years’ to be absorbed
United Arab Emirates: Sunday, March 20 – 2011 at 16:28
Dubai’s real estate sector has taken a high-profile battering since the credit crunch hit the emirate. Prices continue to crumble as more supply comes online, and with 25,000 new residential units alone likely to be released onto the Dubai property market in 2011, how long will it be before the oversupply problem is solved?
According to a report published this week by real estate consultancy Jones Lang LaSalle (JLL), the supply of new units in Dubai in 2011 is likely to drop 32% from 2010 figures. In an effort to manage the emirate’s oversaturated property market, developers will limit the supply of residential and retail space, as well as new hotels.
JLL said that some 25,000 residential units are likely to be released onto the Dubai property market in 2011, down 31% from new supply in 2010. Meanwhile, new retail space will reach 140,000 sq m – down 31.7% on the previous year – and 3,400 new hotel rooms will become available, around 55% less than the 7,700 delivered in 2010.