Dubai Properties, Sama Dubai and Tatweer have merged in an attempt to lessen the impact of the financial crisis. Dubai holding now consists of just 4 divisions instead of the previous 7 – investments, hospitality, property and business parks. there is also talk of merging Emaar properties into this new vehicle.
The amount of property for sale in Dubai is now having a strong effect of rental yields. Unable to sell, many owners are putting their property on the market as a rental unit instead. This is having a marked effect on rents. RERA (The Real Estate Regulatory Authority) published its new guidelines, showing a 50% fall in rents in certain areas of Dubai and Landmark’s report this month shows a further 30% fall in Palm Jumeirah and recommends even cheaper rents than RERA’s. This is good news for prospective tenants, and suggests we still have some way to go before Dubai’s property crash bottoms out.
The Central Bank of the UAE has just bought $10 billion of the $20 billion long-term bonds Dubai issued on Sunday. The five-year bonds pay 4% per year.
“This is a clear step from the central government to back up Dubai,” said Khald Masri, a partner in Rasmala Investment, a very active investment bank in the region. “The central government’s step will help ease the tense situation in the local economy and markets.”
More on Dubai Bubble Update – Another $10 Billion goes into the hole
These are findings from YouGov’s second ‘Reality Check – UAE’, a monthly research report, designed to help companies prepare for survival in a downturn. The research tracks how UAE consumers are reacting to the global credit crunch and gives industry specific recommendations. 779 UAE residents responded to the survey between 20th-29th January 2009.
More on UAE Reality Check Shows Big Increases in Job Losses and Dropping Confidence
