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Real Estate Market Crash Will Affect Banks, Say Experts

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DUBAI — Should the real estate bubble burst in the UAE, it will have serious implications for banks, according to industry observers.

Property prices have almost doubled in the last three years as Dubai has transformed itself into the region’s trading and tourism hub. But a surge in construction projects, especially luxury residential developments, have raised fears of a property bubble.

However, the lack of indicators and indices of real estate and property prices and detailed information about the market, makes it difficult for banks to assess the risks related to their exposure either through their lending business or through other lines of business.

Banks in the country are mostly focused on real estate market, which is currently experiencing high momentum and a structural need for financing. Banks’ total lending to the real estate is estimated at about 15 per cent, which is although not high, but enough to seriously impact them in case of severe downturn


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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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