Adil Taqi, group CFO of Damac Properties, said Iran’s negotiations with Western governments could open doors for Iranians to invest in Dubai’s property market, according to Bloomberg.
So far, neither the Iranian nor the US legislatures have approved the agreement, which will include easing restrictive economic and financial sanctions, resulting in freeing financial power, a substantial part of which will target Dubai markets, including the real estate sector.
Iran is one of the traditional business partners of the UAE, but there has been a decline in trade between the two countries due to the sanctions in Iran. Nevertheless, Iranians invested AED4.5 billion in Dubai’s real estate market in 2014.
However, for some time now, property values in Dubai have been declining, with slowing sales due to factors including the oil price change, weaker currencies in Europe and Russia, and oversupply. In July, Standard & Poor’s estimated home values might drop by as much as a fifth this year. Brokers CBRE Group and JLL saw a ten per cent decline.
On the other hand, Dubai-based Exotix Partners expects the real estate sector in the UAE – along with other industries like transportation and finance – to benefit from the easing of sanctions on Iran as this may lead Iranians to invest in Dubai’s real estate market.
Taqi noted that Iran’s progress in negotiations with Western governments, including the US, could open doors for Iranians to invest in the emirate’s property market.
“I’m no politician, but I look at that development with a lot of optimism,” Taqi said. “I’m not saying there isn’t enough raw data, but there isn’t enough intelligent information to be able to make such statements with such huge conviction.”
“Quite frankly, I don’t see a slowdown,” Taqi added