Real Estate

Real estate investors in Dubai have been cautioned against relying solely on price correction forecasts, with experts highlighting that such predictions based only on new supply data can be misleading. Instead, investors are encouraged to monitor broader market signals for a more accurate view of trends.

In recent months, rating agencies such as Fitch and Moody’s, along with other real estate specialists, projected potential price corrections of around 15% by late 2025 or early 2026. However, Firas Al Msaddi, CEO of fäm Properties, one of Dubai’s largest real estate agencies, emphasized that focusing only on new unit deliveries does not provide the full picture.

“Every few months, we see forecasts suggesting Dubai property prices are about to fall, based on supply alone,” Al Msaddi said. “The market is much more complex. Prices are influenced by demand, liquidity, rental trends, and supply together.”

Using its AI-powered DXBinteract platform, fäm Properties monitors seven key indicators daily to give investors early warnings of market shifts before official data reflects changes. These indicators include:

• Bid weakness: Buyer pushback on pricing, leading to negotiations, discounts, and flexible payment plans.

• Days on market (DOM): How long listings take to sell, with rising DOM signaling slowing demand.

• Sales volume trends: Three consecutive months of declining sales may indicate a genuine market shift.

• Inventory and absorption rate: Rising supply outpacing buyers can create downward price pressure.

• Yield compression: When property prices increase faster than rents, investor returns shrink.

• Rent vs price divergence: Disparities between rising prices and flat/declining rents suggest speculative risk.

• Mortgage costs and liquidity: Higher rates or tighter lending reduce buyer purchasing power.

Al Msaddi added, “Investors can avoid being caught off guard by monitoring all the key signals to spot shifts before they make the news. With tens of thousands of homes scheduled for delivery in Dubai, understanding the full range of market indicators is crucial for informed investment decisions.”

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