United Arab Emirates
Capital: Abu Dhabi
Language(s): Arabic, Persian, English
Total Area: 83,600 km²
GDP (in million USD): 239,650
The United Arab Emirates, sometimes simply called the Emirates or the UAE, is an Arab country in the southeast of the Arabian Peninsula on the Persian Gulf, bordering Oman to the east and Saudi Arabia
After three years of house price falls, Dubai's housing market is now recovering fast, while its neighboring Abu Dhabi, UAE's capital, is still struggling.
The average sales price for high-end villas in Dubai rose by 18.2% to AED1,300 (US$354) per square foot (sq. ft.) in September 2012 from AED1,100 (US$299) per sq. ft. in January 2012, based on a report published by Cluttons. Likewise, the average price of mid-range villas in Dubai increased by 18.2% to AED650 (US$177) per sq. ft. from AED550 (US$150) per sq. ft. over the same period.
In the third quarter of 2012, Dubai's total residential stock was about 349,000 while the total residential stock in Abu Dhabi was around 202,000, according to Jones Lang LaSalle MENA. From end-2012 to 2014, about 37,000 new housing units are expected to enter the Abu Dhabi market and around 50,000 new housing units are projected to enter the Dubai market.
To prevent speculations and another property bubble from emerging, the central bank recently issued circulars to banks cutting the maximum loan-to-value (LTV) ratio for Emiratis from 80% to 70% for the first property and 60% for the second unit. In addition, the LTV ratio was further cut for expatriates to 50% for the first unit and 40% for the second unit. The new rules are expected to be enforced at the start of 2013.
In 2013, demand is likely to remain suppressed in Abu Dhabi, while property prices and rents in Dubai are expected to continue rising, according to Jones Lang LaSalle MENA.