Goodbye Dubai, was it really a good buy?

[Green_Bear]

Property prices start falling in Dubai and Abu Dhabi
Sunday, 26 October 2008
propertywire.com/news/middle … 61920.html

Property sales in Dubai and Abu Dhabi have stalled and resale prices have dropped for the first time due to the global financial crisis, according to real estate professionals.
Off-plan sales have been the hardest hit as speculators struggle to meet instalment plans due to difficulties finding finance. But they are finding it hard to sell on their properties because potential buyers are also finding it more difficult to secure loans.
‘It has been going on for a week now. I have seen prices going down about 10% everywhere, even in Dubai Marina and Downtown Burj Dubai,’ said Khaled Elqassim, the sales manager at Dubai-based property broker AAA.
‘Pretty much all the secondary market is trading at less than it was before the financial crisis,’ said Karen Lay, the marketing manager at LLJ Properties in Abu Dhabi.

[Green_Bear]

Burj Dubai in October 2008
youtube.com/watch?v=bLeQZQggXdc#

Skyscrapers & business cycles
viewtopic.php?f=19&t=12745&

[taipeir]

iht.com/articles/2008/10/16/ … php?page=2

This is going to be a bloodbath… Westerners can’t afford to pay and oil dropping… no real industry and 80% foreign population…even waiters trying to sell property.

tradearabia.com/news/REAL_151403.html
‘The rules are different for us’ classic quote…it’s going to get nasty.

[yoganmahew]

I read a couple of very bearish pullout sections in the FT last week that more or less said that Abu Dhabi was going to end up owning Dubai.

[Green_Bear]

**Dubai property prices ‘will never decline’ **
20 October 2008
zawya.com/story.cfm/sidZAWYA … f%20Wonder

Investment bank EFG-HermesEFG-Hermes caused a stir last month when it forecast that property prices in Dubai would fall by up to 20 per cent by 2011 after peaking next year.
But in an exclusive interview with Emirates Business Salem Almoosa, Chairman and CEO of Falconcity of WondersFalconcity of Wonders Falconcity of Wonders, dismissed such suggestions and said prices would not fall and there would be no correction.
And he accused prospective buyers who said prices were about to fall of doing so in the hope that such speculation would drive the market down and they would be able to buy more cheaply.

Are real estate prices in the UAE set to go down as has been suggested?
In my opinion prices will never ever go down due to several factors. First and foremost is that we have a visionary leadership that has conducted the essential and proper studies regarding the situation in the Middle East as a whole, as well as a studying the situation in the emirates in particular. So they have a plan. Of course the execution of the plan is not the end of the story, they went further than this by minimising the risk in the execution of the plan which means they looked at the fundamental issues such as economic factors, the political issues, the social issues and so forth. They took all the issues and points concerning the real estate market and took the necessary steps. I also think individuals should not throw speculation into the market for their own purposes. If parties are spreading rumours that prices will go down they are doing this so they can buy cheaply and not because that is a reality. I believe people should not speculate unless what they say is supported by facts.

And a price correction?
I believe there will not be a price correction in the market. Who is saying this? I have not heard of any correction or decrease in prices and I am not seeing it either.

[Green_Bear]

Financial crisis moves to Gulf Arab nations
By DIANA ELIAS and TAREK EL-TABLAWY
ap.google.com/article/ALeqM5hSbY … AD942C1680

KUWAIT CITY (AP) — Kuwait moved Sunday to prop up the country’s second-largest commercial bank and scrambled to protect depositors at other domestic banks, dashing hopes the oil-rich Arab Gulf would emerge largely unscathed from the global financial crisis.
The central bank halted trading in Gulf Bank shares because of high derivatives losses, just a day after Gulf finance ministers said the region’s banks were insulated against the liquidity crisis that has rippled through the global banking industry.
“The halting of Gulf Bank shares spread panic in the bourse today because the government has been saying banks are safe from (global financial crisis) losses,” investor Ahmed al-Fadhli said a telephone interview.
The Saudi stock exchange — the region’s largest — fell by 8.7 percent Saturday and is down more than 50 percent since January. Saudi’s benchmark Tadawul index closed down about 1.6 percent Sunday, while the Dubai Financial Market sank 4.7 percent, and Qatar’s exchange closed down almost 9 percent. Kuwait’s exchange was down 3.5 percent at closing.
The losses tracked most other major world market indices, which saw declines Friday.
Neither the government nor Gulf Bank revealed the size of the losses or their timeframe. But Ibrahim Dabdoub, the chief executive of the National Bank of Kuwait, told Al Arabiya television the losses were up to $742 million.

[Green_Bear]

This is not Dubai’s only problem, their oil output has been declining over the last few years

Switching to oil recovery
pipelinedubai.com/focus/2006/cf0107.html

The United Arab Emirates is switching to the deployment of advanced technology at the expense of exploration to maximise its oil recovery rates as costly programmes to hunt for more oil are unlikely to result in major discoveries, according to a new official report.
The bulk of expansion projects are being carried out by Abu Dhabi, which controls more than 90 per cent of the UAE’s oil and gas, and at least $10 billion will be invested to raise the country’s crude output capacity to three million bpd in 2006 and 3.7 million bpd in 2010.
The 350-page report for 2006, just released by the Ministry of Information and Culture, said Abu Dhabi alone has around 92.2 billion barrels in proven oil reserves and that at present production levels, they can last as long as 129 years.
In Dubai, industry sources said the emirate has embarked on an ambitious programme to maximise recovery rates after a steep decline in its crude output over the past few years.

[superpiper]

i see the adverts for the new cities in qatar and dubai, but how in gods name do they fill these huge skyscrapers up?

who works in 'em and where do they live and where did they come from and what do they do?

it baffles me

[yoganmahew]

@superpiper

i see the adverts for the new cities in qatar and dubai, but how in gods name do they fill these huge skyscrapers up?

who works in 'em and where do they live and where did they come from and what do they do?

it baffles me

Commercial real estate companies, building supply companies, construction management companies, worker recruitment companies… do you think the ancient Egyptians knew what they were doing when their buried their pharoah/gods in pyramids?

[superpiper]

@yoganmahew

@superpiper

i see the adverts for the new cities in qatar and dubai, but how in gods name do they fill these huge skyscrapers up?

who works in 'em and where do they live and where did they come from and what do they do?

it baffles me

Commercial real estate companies, building supply companies, construction management companies, worker recruitment companies… do you think the ancient Egyptians knew what they were doing when their buried their pharoah/gods in pyramids?

sounds like ireland

so they are as fooked as us? those damn pyramids…(schemes)…

[Green_Bear]

@superpiper

i see the adverts for the new cities in qatar and dubai, but how in gods name do they fill these huge skyscrapers up?

who works in 'em and where do they live and where did they come from and what do they do?

it baffles me

I work with some Pakistanis who have bought investment properties there, guaranteed rent etc. It’s their pension plan.
Al ot of Indians also work there on construction and services.
I think the attraction is based on the “Shanghai, Mumbai, Dubai or goodbye” fallacy.

Shanghai, Mumbai, Dubai or goodbye. The year of reverse bailouts
Brad Setser | Jan 10, 2008

Shanghai, Mumbai, Dubai doesn’t really quite work. The CIC is in Beijing, not Shanghai. Singapore has committed more funds to troubled banks than Mumbai. Abu Dhabi, Saudi Arabia and Kuwait have a lot more cash than glitzy Dubai.
But Andrew Ross Sorkin’s alliterative phrase captures a deeper truth.
A group of banks that previously had advised most US companies that they had too much equity and too little debt have found themselves short on equity.
And a group of banks that in the non-so-distant past argued that state ownership was a barrier to development are now themselves partially state-owned.

rgemonitor.com/setser-monito … e_bailouts

[Mikey]

More bad news from Dubai:

Property prices on Palm Jebel Ali fall by up to 40%

PALM PRICES: Investors in off-plan properties on the Palm Jebel Ali have been forced to reduce prices to find a buyer, agents say.House prices on the Palm Jebel Ali, second largest of Nakheel’s palm-shaped islands, have fallen by as much as 40 percent in the last two months as the global financial crisis sees foreign investors move to liquidate assets in Dubai, according to three Dubai-based real estate agents.

“I never expected [prices on the Palm Jebel Ali] would have come back so quickly and by so much,” said Jeroen Van Der Geer, partner at AA Properties in Dubai. “We are back to a level of one and a half to two years ago.

From …

arabianbusiness.com/537326-p … li-fall-40

More news here:
arabianbusiness.com/537410-a … tal-prices

[ewd3]

“I never expected [prices on the Palm Jebel Ali] would have come back so quickly and by so much,” said Jeroen Van Der Geer, partner at AA Properties in Dubai. “We are back to a level of one and a half to two years ago.

who would have thunk it

property also goes down…

Dubai more bubblicous than dublin???

[2Pack]

Ireland has been Cancelled .

worlddubai.co.uk/irelandinthesun.htm

"‘Island of Ireland’ Dubai

The sale of the properties on this project is currently on hold."

How sad !

[Mikey]

So what is going to happen to all these “investors” who bought from the developers in May 2007?

IRISH property developers have sold more than €100m worth of luxury accommodation in just two days on Dubai’s own Ireland in the sun .
From the skies the €200m luxury island holiday resort has the shape of Ireland and is being built with an Irish theme, right down to its own Giant’s Causeway.

From:

independent.ie/unsorted/migr … 69102.html

[The_Unwelcome_Guest]

@Mikey

From the skies the €200m luxury island holiday resort has the shape of Ireland and is being built with an Irish theme, right down to its own Giant’s Causeway.

What were they smoking???

[double_down]

At the end of this interview Mark Faber is very bearish on Dubai property.
ritholtz.com/blog/2008/11/fa … an-stocks/

[OverseasCafe]

@Mikey

So what is going to happen to all these “investors” who bought from the developers in May 2007?

Squeaky bum time

[Inis_Man]

Dubai residential slumps > 15% year on year, asking prices at 2008 again

https://www.propertymonitor.ae/dubai-house-price-index/#emirates_living