Dubai: 2 flats for the price of 1

Real estate agents report of considerable drop in apartment prices in UAE; local Banks said to be cutting down on housing loans

Doron Peskin
Published: 03.14.09, 10:17 / Israel Business

The deep recession in the real estate market in Dubai has been forcing local companies to launch attractive marketing campaigns in a bid to get rid of their inventory of apartments.

Ads offering buyers to purchase an apartment and get another one for free have been appearing in recent days in newspapers in the United Arab Emirates country.

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The company behind this "two for the price of one" campaign is Imad Real Estate, which explained that whoever buys a two-room apartment with a living room for about $600,000 will get a one-room apartment with a living room for no extra cost.

Both flats include parking spaces. According to the company, it will sell both to local residents and to foreigners.

The company's CEO, Imad al-Anani, says that there is no decline in the demand for housing in Dubai. The problem, according to him, is that local banks are cutting down on housing loans, causing the demand levels to drop.

Al-Anani explains that the only change in the demand patterns in Dubai these days was that consumers prefer ready apartments and are less interested in projects which are in the process of being built.

Real estate agents in Dubai say that a significant drop has been recorded in the prices of apartments in the UAE in the past two months. In some cases, the price reductions have reached 70%.

According to estimates, the low price trend will continue in the coming months and perhaps even throughout the year. Dubai officials have noted that the summer season is traditionally characterized by a standstill in the local housing market.

Doron Peskin is head of research at Info-Prod Research (Middle East) Ltd.

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