(Bloomberg) -- Dubai's property market is set to consolidate gains this year from a rebound that started in 2021, according to S&P Global Ratings, echoing property consultant Knight Frank.
“The market is set for a moderate increase in property prices, rents, and increased sales volumes this year,” analyst Tatjana Lescova wrote in a report. “Geopolitical events and their economic fallout are a risk, but we expect Dubai will attract interest as a safe haven.”
Dubai's property market came alive last year after it became a haven for the wealthy escaping lockdowns and for others drawn by the ease of getting vaccinated. It also provided an additional lure after a downturn shaved more than a third off values.
Dubai's luxury home market should keep growing after a “spectacular turnaround” in 2021, Knight Frank said earlier this month. Prime prices in Dubai accelerated 44% last year, sending the Middle East business hub to the top of Knight Frank's Prime International Residential Index 100.
S&P also said:
- Dubai residential and commercial property developers are expected to post improved revenue and earnings over 2022
- “Pressure on profitability will ease and companies' adjusted debt-to-Ebitda metrics will improve as Ebitda increases”
- Support should come from Dubai's economy, which is forecast to expand by 2.5% in 2022
- Over the longer term, the market should also benefit from an increasing population and government initiatives including new visa rules, more liberal social laws, the shift to a Monday-Friday working week, and relaxation of company ownership rules
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