Ryan Mahoney

One of the hottest talking points in Dubai with regard to the real estate industry is whether there will be an over supply of top end apartments once several new developments that are now close to completion come on to the market and, if so, what will be the consequences.

'There will definitely be an over supply of units in some sectors, especially with regard to apartments, and everybody is concerned about this. We have seen speculators shying away from some projects now, particularly those where there is a heavy concentration of development.

'But the key to this is geography. If you look at somewhere like Dubai Marina, for example, there are lots of towers there but the place will manage to hold its price because of its desirable location. The developments that might suffer are those positioned further out in the desert.'

Better Homes has become a familiar and trusted name in the real estate sales and letting business in Dubai but there are other rather less reputable agencies out there and the Dubai Land Department has recently brought in a new initiative that will lead to the registration of real estate brokers. The process could see the number of brokers cut by 50 per cent but Mr Mahoney is pleased by the government's decision.

'This is a wonderful initiative and we have been encouraging the Land Department to introduce this for a long while. But it will take years for a tangible change to occur. At the present time, it is more of a mission statement really.'

For Mr Mahoney some form of control on the actions of clients would also be a most welcome introduction.

'Sometimes a seller that pulls out of a deal can give a real estate agent a bad name. Any regulations that are brought in should also cover how buyers and sellers conduct themselves. It is not just a question of regulating the agents. In other markets, there is a clear legal structure controlling this, but here in Dubai it is currently very difficult for us to impose our contracts on anyone that reneges on an agreement. Legal processes take a very long time.'

Mr Mahoney had a lot of positive things to say about another recent government ruling which was also well received by tenants in the city - the seven per cent rent cap.

'Steep rental rises can often create more problems than benefits. For instance, when prices rise a lot, agents tend to get blamed and we take a PR hit with some resentment coming our way. The seven per cent cap will be beneficial to Dubai's economy and so I'm all for that, as the cost of living has been spiralling out of control. From Better Homes' perspective, the ruling also only concerns renewals, not new contracts, and with so many new properties being released, it won't affect us very much.'

But won't the cap have an impact on the buy-to-let market with buyers put off by smaller profit margins?

'It is true that rental rates do drive sales prices and so, as rates slow, there is no doubt there will be some impact but it is hard to say how much of one. In some parts of Dubai yields are already down to about six or seven per cent but there are currently big opportunities in commercial office space. This is a great investment but you have to be selective of course. Rental rates have doubled in a year and sales prices have grown by 50 per cent.

'But as more projects come on to the market, I am constantly surprised by Dubai's ability to absorb them. Over the course of time, some units will certainly continue to rise and some will fall. The over-riding factors in this will be specific issues like how many bedrooms they have and, of course, location.'