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15 April 2024

UBS predicts 30% price fall in Abu Dhabi

By Agencies

UBS expects property prices in Abu Dhabi to continue sliding till 2012, as financing for mortgages and small and medium enterprises remains challenging and project delays are likely.

The brokerage, according to Reuters, said it expects prices in Abu Dhabi to decline another 30 per cent. Housing supply growth was poised to outstrip demand growth, UBS said in a note to clients. According to Investment Boutique, residential demand would likely grow 6.7 per cent during 2009-2012, while supply was expected to rise 17 per cent during the same period, UBS added.

On Monday, Sorouh Chief Operating Officer Gurjit Singh said he expects in excess of 4,000 units to come online this year in Abu Dhabi, which will help stabilise the market, while Aldar Properties' Chief Executive Officer John Bullough said property demand in Abu Dhabi will remain "subdued" this year.

The hospitality sector expects to see supply of hotel rooms rise from about 4,000 currently to 20,000 by 2012, despite softer business traveller and leisure markets.

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