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Is Dubai’s property market still too hot?

If you wanted to make a quick buck in property, Dubai would have been the place to do it in the last couple of years. And the desert of superlatives is still going strong despite a partial slowdown.

According to CBRE Group, apartment prices increased by a more modest 3.2 percent in the second quarter of 2014, bringing gains over the last year to 21 percent. But that’s exactly the problem.

Memories of the last real estate bubble that blew up in 2009 and exposed a debt-laden Emirate are still fresh.

Read More: DP World Chairman tells CNBC: Dubai never had a property bubble

“In our view, the residential market is getting close to the top and we would perhaps expect growth for another 12-18 months, but certainly not at the rate we’ve been seeing. It’s been unsustainable,” Craig Plumb, Head of Research, MENA, at Jones Lang LaSalle (JLL), told CNBC.

The government has moved to cool the rally, doubling transaction fees to four percent and introducing revised caps on mortgages at the end of last year. Still, the International Monetary Fund (IMF) has warned repeatedly over the summer that more measures are needed to avoid a replay of the previous disaster.

“The threat of another period of anomalous growth as we saw in 2007-08 was curbed through the effective combination of government backed legislation and general affordability has helped to rein in growth. This is reflected in the falling number of transactions, particularly at the top end of the villa market,” Steve Morgan, Chief Executive at Cluttons Middle East, explained to CNBC.

Some of Dubai’s biggest developers have also moved on their own to ban real estate brokers from reselling off-plan properties before handover.

Plum agreed further policy action was warranted. “Yes, they’ve done more than they did last time. Whether they have done enough? There is probably a need to do more things,” he added.

Beyond the announcements of Dubai architectural grandeur is the untold story of delayed projects and those that never saw the light of day. CNBC visited several abandoned construction sites and spoke to many investors hurt by the last property crash; nobody agreed to appear on camera due to ongoing litigation or fear of retribution.

Read More: Dubai property market still sparkling…for now

There is another fundamental difference this time round. Turmoil in the Arab World, from Libya to Syria, means wealth is often looking for a new home, and most roads lead to Dubai. If you’ve got money, there are plenty of ways to spend it here without getting asked too many questions. Case in point: An estimated 70 percent of property transactions are in cash.

Mahesh Menda, a prominent investor who came to Dubai over three decades ago and was among the first buyers at one of the Emirate’s most prestigious addresses, is no stranger to the property market’s volatility.

“Even today, if I had to buy land, or say a luxury apartment, the best price I pay in one of the best towers is a thousand dollars [per square foot], give or take 10-15 percent. I compare that to New York, to London, to Bombay…this was going for a song”.

According to the Dubai Land Department, the top foreign buyers of property in Dubai are from India, the United Kingdom, Pakistan and Iran.

Read More : San Diego real estate cools off: Will rest of California follow?

A rapidly growing pipeline of projects is only fueling the “bubble talk” in the city’s offices and cafes. The government plans to build a mall bigger than the world’s biggest it already has, an entire addition to downtown Dubai with villas, hotels and residential apartments. In total, JLL forecasts more than 40,000 additional units to come online through 2016.

Strong economic growth will fill a large chunk of that space. The IMF expects expansion to average 5.5 percent until the end of the decade, underpinned by the city hosting the world’s fair, the Expo in 2020.

You have to visit Dubai to get a sense of the scale of the construction boom that is underway. And with more grandiose projects announced, the next few years will be a real test for whether the Dubai property market has actually matured.

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Dubai is not a plastic city

Have you heard a numerous times about Dubai not being or lacking culture, or even calling It a plastic city well this is a familiar story to all of us but that not what actually Dubai is all about.

The number of times that we could hear it with or statement with variation is limitless. The truth about Dubai is- it is actually having abundance of Culture, Dubai is not actually always what people might be anticipating for but definitely it rich in its own culture.

Dubai is not a plastic city

Dubai is known to have a young history compared to other cosmopolitan cities and when Dubai cultural is to be defined then Dubai is known to have the most unique culture of its own. So what actually is a Culture? It is simply the demonstration of intellectual attainment such as customs, ideas and social behaviours.

In a matter of 50 years, Dubai had developed from a mere desert land to a tourism and business destination. The enormous growth and numerous sprouting infrastructures and intense development is incomparable by any other city in the planet and  sketching its name firmly on the worldwide map by persistent following of exclusive visions and  attaining greater pinnacles.

Dubai rapid speed in developments and daring courage is seen in the everyday way of life.

Dubai is the city of happenings, happening that are too tricky to assume. Numerous new instigations and initiatives are under taken by private organisations and government on a frequent basis to further enhance the way of living and mounting the art scene in Dubai

Devoid of government initiatives, affluent individuals, prosperous companies and well of banks promoting numerous developments, there would not have been an international artistic legacy that we have a high regard for today. A comparable event that is taking place in Dubai is the inaugural Dubai Art Season, The city’s umbrella arts programme instigated by Dubai Culture and Arts Authority.

Numerous creative events and activities were filled in from March 14th to April 15, highlighting the eminence as the global inspired nucleus.  There were also premier art events comprising art week, the comic con, Middle East Film and Gulf Film Festival.  There are also numerous flagship events, design Days Dubai, SIKKA Art Fair and Art Dubai, along with numerous planning, performances, workshops and outdoor art design and exhibitions are also held.

Dubai is a city indulging itself in its unique culture and going beyond boundaries, discovering new talent and evaluating the limit of human’s creativity and cleverness. So if anyone decides to take a break and look around Dubai Cultural happening, you will be awestruck to find diverse and various cultural events and interactions taking place. There is more to Dubai than how it is evaluated by many eyes or the credit it gets.

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