Global Slowdown promises to be a blessing in disguise for the Dubai’s Rentals

The controversies that have been savaging the Dubai rental properties segment appear to be relentless in their onslaught. The origins of these developments can be traced back to about a decade or so. For long, Dubai had seen realty developments on an unprecedented scale. Both, the authorities and master developers were leaving no stone unturned in their efforts to transform Dubai into the pearl of the Middle East. No cost was too much, no concept outrageous. Pushing the boundaries of acceptability, Dubai seemed to be the dream that straddled the old and the new with total aplomb!

Trade and commerce too responded and brands, both big and small made a bee line for the Emirate. Tourism took off heavily, with resorts, leisure parks and other hospitality ventures tried to out do each other in both scale as well as uniqueness of experience. Dubai soon became the place to be seen in for everyone. Businesses, individuals, employers, employees, everyone; people were said to be taking the next flight out to Dubai.

Fuelled by this growing demand, infrastructure began to be drafted into place. An extensive road network began to be developed. Realty soon began the buzz word as authorities in a master move, opened property ownership to international investors. The sky was literally the limit after this. Property owners were devouring everything that the developers could throw at them. Luxury and opulence became the preferred calling cards of players and investors alike. Since not all owners would come to stay permanently, many decided that their prized possessions could earn them fantastic returns. The market for Dubai rental properties took off.

Many insiders were however starting to get worried. The economic climate was becoming harsher by the day and few doubted that a correction was in the offing. The only question on their minds was when! About two years ago, the first signs came calling and the Dubai rentals market bottomed out.

Developers and investors alike were panicking. The former saw their credit lines drying up and many projects had to be put on hold, some for indefinite periods of time. Investors on the other hand saw a significant chunk of their asset value getting wiped out overnight. Even the demand for properties on rent in Dubai slowed down drastically.

Quite a few controversies have emerged following this. Rental scams, foreclosures, etc. left no one untouched in the industry. Ultimately, the Real Estate and Regulatory Agency (RERA) and the other authorities had to intervene and bring in some semblance of order. The rules governing the realty industry consequently have seen a lot of refinement. This refined and inherently efficient system of functioning that has come about during a tough time should be seen as an unlikely boon.

With business being cyclic in nature, it is only a matter of time before things start to get better. When this happens, Dubai should be poised for yet another shot at the skies.