Thursday, Feb 12, 2009
Property prices falling by 180% a year
NY Tines: Laid-Off Foreigners Flee as Dubai Spirals Down
OK, I know the math is wrong, but prices have fallen by 30% in 2 months in some areas in Dubai as expats are laid off and leave the country. NYT article rehashes what was in the Times a few days back, but still amusing to read. Again, what were they thinking was going to happen?
Posted by richc @ 08:29 AM (1390 views) Add Comment
28 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. drewster said...
The company I work for has an office in Dubai, apparently they're all just sitting their twiddling their thumbs. The work has dried up completely.
2. drewster said...
The company I work for has an office in Dubai, apparently they're all just sitting there twiddling their thumbs. The work has dried up completely.
3. str 2007 said...
What type of work drewster ?
4. inbreda said...
professional thumb twiddlers?
5. shipbuilder said...
Even while the 'house prices will rise forever' myth was well and truly burst everywhere else in the world, clearly it was thought Dubai was the exception. Incredible.
6. jack c said...
Lots of people I'm told are handing in the car and house keys and fleeing the country whilst they can - most of the imprisonment out there is for non payment of debts under shariah law - anyone verify or dimiss this?
7. it_is_going_with_a_bang said...
My inlaws bought 5 flats in a block of flats being built. As far as I know they have not yet been completed. I have a feeling they were hoping to sell 4 and keep 1 with a healthy profit - when they invested originally 18 months ago. Part of their pension apparantly....
I shall tread carefully when the topic of Dubai comes up. Although I have a feeling it won't come up in conversation ....
8. bellwether said...
Wasn't there a believe that Dubai's oil wealth would provide support for the market. The state has spent a huge amount of reserves in development with a view to turning Dubai into a tourist destination once the oil ran out. Could this be a metaphor for how powerless even a rich state can be in supporting a bubble. Credit money mutilpied throught millions/billions of people creates not just the volume of money to cause huge asset inflation but also the requiste illusion of wealth to allow the bubble to inflate and inflate and inflate. State intervention, even very very rich state intervention, seems to be puny in comparison to this
9. str 2007 said...
inbreda
yes very good.
igwab
Sorry it's so close to you and to a degree you can understand why people try this, it all appears so easy. Buy 5 flats off plan and cash in the 25% rise on completion to end up with a flat for free.
Classic bubble mentality though and you can imagine that same story is echoed right across Dubai.
I haven't been there and nor do I harbour any desire to, but you can imagine Dubai just ending up as a skeleton ghost town buried in sand only to be re-discovered in 4000 years time. Well I can anyway.
10. inflation is eating my savings said...
>I haven't been there and nor do I harbour any desire to, but you can imagine Dubai just ending up as a skeleton ghost town buried in sand only to be re-discovered in 4000 years time
poetic.
11. Mrperegrination said...
I'd be very concerned if I was a westerner in Dubai at the moment. I'd get the hell out in case they decided to close the borders.
12. layers said...
The FT was talking a few months ago (or was it the Economist?) about Dubai becoming the new Switzerland for the Elite, so I wonder how the really expensive properties in 'The World' / 'Palm' etc. (where Beckham has a property - allegedly given to him) are fairing? The new lower class in the tower-blocks I can understand would be suffering as their jobs evaporate, but wonder how the region will play out and if the Elite really are re-locating – if so, could be worth investing in next 12 months.
13. tudorian said...
somebody posted Shelley's Ozymandius recently. Seems rather apt here, so I'll repost for your enjoyment.
I met a traveller from an antique land,
Who said--"Two vast and trunkless legs of stone
Stand in the desert . . . . Near them, on the sand,
Half sunk a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them, the heart that fed;
And on the pedestal, these words appear:
My name is Ozymandius, King of Kings,
Look on my Works, ye Mighty, and despair!
Nothing beside remains. Round the decay
Of that colossal Wreck, boundless and bare
The lone and level sands stretch far away."
14. bellwether said...
Layers I've wondered the same thing, there will be some demand but with so much choice globally I'm thinking not enough. Also a lot of the appeal was the buzz of the place and suspect that was intrinsically linked to the bubble.
15. phdinbubbles said...
@inflation is eating my savings said
"I haven't been there and nor do I harbour any desire to, but you can imagine Dubai just ending up as a skeleton ghost town buried in sand only to be re-discovered in 4000 years time. Well I can anyway."
I was thinking about posting a comment along the same lines earlier - archeologists digging the place up in a couple of thousand years and trying to work out why the hell anyone built the damn place and puzzling over why the inahbitants thought they could sustain life there. Don't think this pyramid in the desert will last as long as those egyptian ones.
16. stillthinking said...
Dubai has had a chronic case of Dutch disease, followed by a too rapid cure which will kill the patient.
17. richc said...
Why would Dubai ever end up as a retreat for the world's elite, especially if the beachfront just ends up as an appendage of a rotting hulk of a slum? It's hotter than Hades (and humid, too), the beach is covered in raw sewage, the legal infrastructure is appalling (try not to get raped there) and you have all of the social freedoms of a conservative islamic dictatorship. Doesn't that sound appealing? Dubai might turn into a retreat for Arabs getting away from Saudi Arabia, kind of like Cairo or Beirut, but then Cairo or Beirut haven't exactly been property investment hot spots.
18. richc said...
Gotta love the ads that Google is throwing up for this post:
Dubai Investment Property
Irish Developer Escrow Account Open Contracts Ready - From £46,033.
Dubai-InvestmentProperty.co.uk
Invest in Dubai -- through an Irish developer, no less.
19. It_is_going_with_a_bang said...
Dubai has or rather had the 'buzz' because people thought that simply being there would 'make you rich'.
As soon as that illusion has gone so will the desire to be there.
Ask anyone what makes Dubai a 'place to be' - it's just the money pure and simple.
20. jack c said...
Update to earlier post see www.express.co.uk/features/view/83804/British-expats-flee-Dubai
21. timmy t said...
Dubai or not Dubai - that is the question. (To buy or not to buy - can you see what I've done there...?)
Oh and NOT Dubai is the answer - in case anyone was wondering.
22. phdinbubbles said...
Pyramid Dwellers:
Ziggurat Pyramid Dubai: The Most Funkiest Project ever Envisioned
23. mdmick said...
Ozymandius?
Didn't he play for Tottenham?
24. mountain goat said...
Dubai's hp bubble was still going strong last year!
FT
25. japanese uncle said...
Recently a Japanese sushi chef was imprisoned in Abu Dhabi Prison after he was fired (The moment a foreign worker is fired, he is deemed to be an illegal overstayer under the local law!!). He recently wrote a book 'Dubai the earthly hell' in which he described the smell of the prison cell being beyond any human description or imagination, as most of the inmates were given no chance to wash for more than a year. I hope this French woman can be spared that horrible destiny.
The lesson is stay away from any bubble economy unless you are sure about the right timing to quit.
26. japanese uncle said...
30% in two months! Phew--- Looks like 95% drop in a year, and that most certainly.
27. jackas said...
Remember the fireworks? Remember the £20,000 a night hotel rooms?
I said at the time that people would be talking about that hotel in 200 years time the same way we talk about tulip mania now.
28. iguana said...
Tudorian;
I stood above Porlock with Mrs Iguana recently and as I pondered the outcome of the current financial crisis and concluded that the banks et al had to write off all of the toxic carp, I too recalled Ozymandius.