Dubai property sector will bounce back when financial system rights itself

It is a failure of the financial system that has prompted steep price falls in some parts of Dubai, it is claimed. Once the financial system is restored the uncertainty about property prices will disappear and the sector will be able to resume, said Fahad Sattar Dero, chief executive of Sweet Homes Group.

He added that the global financial meltdown has had a detrimental impact on customer sentiment, impacted the stock market and drained liquidity from the system and this has led to a wait-and-watch approach from end-users.

'Consequently, it is now probably time for a reality check and an opportunity for investors to go back to their drawing boards and wait for the right values to come back to the market. Property investment is never ever a loss-making proposition. What is needed is patience,' he said.

Despite some high profile companies make large numbers of staff redundant he revealed that his company is recruiting operation staff.

However the bigger players like Nakheel, the emirate's biggest property developer, it is unclear what effect the loss of hundreds of jobs is having on the business. The company refused to discuss its position after recently announcing the lay off of 400 employees, some 15% of is 3,300 staff.

'Nakheel is a privately held company and does not reveal financial information. While details of the redundancy package are confidential and are privileged company-employee matters, the well-being of our employees is of prime importance to us. Therefore, we have taken into consideration social, financial, and professional welfare in providing redundancy packages,' a spokesman said.

It is also delaying a number of projects, as are other developers as they brace themselves for a slowdown in demand for properties across the region and as access to credit dries up.

According to statistics made available by Building and Construction Network, Nakheel's portfolio includes a total of 571 projects with more than 249 still under construction.