The real estate market in the UAE is no doubt one of the most profitable in the entire world. Year in and out, millions of dollars are invested in new areas creating room for many new opportunities. However, in recent times, the industry has experienced some decline in terms of ROI.
The previous year has been more of a recovery period as it heralds a new decade, 2020.
Generally, the past decade has seen a lot of ups and downs. However, despite the decline, the previous year has been more of a recovery period as it heralds a new decade, 2020. Several factors have been attributed to be responsible for the decline.
Drop in oil prices
The UAE is known to be among the top oil-producing countries in the world. While Dubai may have other sources of revenue, most other cities in the region depend largely on crude oil. Consequently, there has been a massive drop in oil prices over the years which invariably has affected the economy of the UAE. Similarly, a drop or inconsistencies in oil prices over the years has had its toll affecting the purchasing power of investors.
Stronger currency
The UAE uses a single currency, Emirati Dirham (AED). Over the years, the currency has gained against many other currencies in the world thereby making it much more expensive to buy properties in the region. Invariably, this has affected the real estate market in the UAE.
A peek into the future
While there are several other factors that have fueled the decline in ROI in the real estate market in the UAE, it is time to move ahead and think about what the new decade has to offer. The factors that have caused the decline will always be there especially these two already discussed. However, with the current rate of investments and diversification, there is no doubt that 2020 and the years to come has a lot more to offer real estate investors.
A major highlight and hope for the real estate market in 2020 is the upcoming Expo 2020. There is no argument to the fact that the UAE has made huge progress over the past two decades. The Expo 2020 is all about showcasing that progress to the entire world. The event is expected to last for months starting from October. During this 6-month period, the UAE will be graced by more than 25 million international visitors from all over the world. So far, expo 2020 has been the headlines of many investments talk especially in the real estate market. Certainly, if this is an opportunity of a lifetime where in the market can take advantage of the Expo to plunge back to life.
