Dear All,

I can't help you with my comments on what to do, but I'm thinking that people smarter than me would fill this post.

Let's be smart - and take advantage of all situations that's going to happen
Bursting or no bursting...

Cheers

How can you take advantage of a Bubble Burst? It bursts dude. . .all air is gone. .. cant do anything but say "oh s***"

But lets not be too negative. This country's economy is goin well, its oil backed... also alot of investors who are much bigger than me and you have invested in this market... so everythin will be done to maintain this Dubai Success.

Maybe the reward will not be as big as it used to be and this is whats called a correction, but a total burst? i dont think so. Prices will need to be corrected because they are goin up toooo quickly.

Inv.

Yes, you're about right.

Maybe the name of the topic is a bit too much.
Ok - so what would be best move to do when prices start to go down. Probably it will cause some panic - so that panic can be used to someone’s advantage...right? Just thinking of all possibilities.

Do you live in Dubai? Do you know the market?

As far as I can see prices are increasing weekly, showing no sign of a correction or "bubble burst." I'm not saying that it won't happen, but you are talking as though it is happening now!

If you know something we don't then please divulge?

If you look at what I wrote - I didn't said that it's happening now. If it was happening now - it would br too late to do anything!

I'm hipoteticaly talking about time 2-3 years from now...or 1-2 years from now...who knows
And yes, I live in Dubai and look to buy property.

mainly the wise man will buy when prices are low and resell when it goes up again, but currently i don't see a bubble happening now due to the following

1. Demand still more than supply due to delay in handover and completion
2. Demand for rental is increasing as emirates receive 600 new residents daily as i red in Arabian business.com
3. Inflation keeps on fueling price increase
4. low interest rates in Dubai keep fueling the demand for buying properties in the marker by end user as mortgage cost will be low.
5. increasing rent will shift tenants to buy properties which will lead to increase demand, hence higher prices

One i Dont see prices going down becoz of the following
1) costs are increasing day by day
2) increasing demand

on the flip side actual end user demand is around <20% (arabian business survey) 80% of the people are investors who are hiking prices most of them will turn to being people who hold prices so will the prices actually go bust ...MAY be YES may be NO

It all depends on other factors where the investments would give better returns -- if other avenues of investments then would give better returns than real esate then the prices would fall to the extent of costs being the limiting factor .

All the best to the people who invest --
All the best to the people who look at the people who invest and think they are the smart ones sitting in the side lines .

__________________
TRUTH is the only "property" I have

Bubble Burst!!

Well they say what goes up comes down!! there will be a burst but not in the next 7 years which is confirmed unless U.S. gets really upset at U.A.E or any of its neighbour

But dubai and abu dhabi prices will increase due to high input of money in these cities and no control on inflation, so by the time they crack or control this inflation it will take seven years, if i got the maths right from meryl lynch.

There will be enormous increase in Abu Dhabi as they have tremendously slowed down giving approval to developers so the demand will henceforth increase drastically.

Ajman will see a lot of end users and it is predicted that 30% of U.A.E population present right now will live in ajman by year 2015

Dubai will be an exclusive hub to HNI, and prices will stabilise by 2015 and it is also predicted Marina prices will collapse due to weak infrastructure of raods and transport.

I have got the whole report as stated by different companies. Lets make it easy to understand for a common man, E.g: IF A FORTUNE 500 COMPANY FIRM RIGHT NOW DECIDES TO PURCHASE AN OFFICE IN DUBAI THEN PRICES WILL STABILISE 2015 COZ THE COMPANY BELIEVES IT IS SAFE BET TO BE HERE.

Dear Design Architect,

Some interesting comments posted and from what I gather it would appear you are on the sidelines wondering if you should buy or not...correct? Your concern is
that perhaps in a couple of years (more or less) the property bubble will burst.

First let me say it is not people "smarter" that can answer the question, but it is perhaps ones that are better informed.
To understand a property market you need know the fundamental elements that fuel it. Lets look at the recent past first...
The Middle-East, Dubai included has benefited from record oil prices fueling (pardon the pun ) the economy.
Statistics from the Colliers report indicating a 78% in the year to the first quarter 2008.
The demand for properties is higher than supply which means completed properties can command a premium. This also fuels the secondary market.
Dubai has established itself as a financial hub and global city, this in itself attracts further investment.
The Dirham is still linked to the dollar.
Prices compared to the global market are still low.

So yes, eventually there will be a "correction" as all property markets go through a cycle. The question is when?...my money would be on a few years down the road, but even this should not be cause for alarm.

If you are planning on staying in Dubai for a few more years...then buy. Remember it is the price you buy for and then ultimately what you sell for that will determine if your investment was a good one. The buying price is a key factor.
Take a simple example.

You rent at Dhs 100,00 per annum ( fixed for 5 years )

Thats 500,000 you have LOST. ( Yes its that simple )

Instead you decide to buy. ( You have a 100,000 saved ) or less, as a deposit
You find a property for 1,000,000 ( lucky you )
You have arranged a mortgage for 25 years ( Your monthly repayments would be around 6,400 for principle and profit for the remaing 900,000. So if your company is paying the rent they are effectively buying your home for you, even better.
Assuming a very modest 10% increase over five years then the same property would be worth Dhs1,610,000. However at current rates you will achieve this a under two years.
If five years you decide to sell and leave Dubai. You sell for Dhs 1,600,000 you deduct the balance of your mortgage Dhs 500,000 leaving you Dhs 1,100,000.

The above is only rounded off and does not consider inflationary costs.

but the point is renting is money down the drain....unless you are the landlord.

Stephen,

You are exactly right. I'm asking such questions and posting such topics in order to get responses and information. Post is deliberately named like that - to provoke people, and to get theirs best and worst reactions...

At the end - I didn't told you anything, and yet you know a lot about me. That's experience. And thinking...

I will invest - I'm just gathering as much as I can