Pecker is a key witness in the case against the former US president, who is accused of falsifying business records to cover up hush-money payment
These additional homes are adding to the supply here and are one of the reasons rents have dropped more than sale prices in recent times. JLL reported that a further 25,000 residential units are scheduled to be delivered in 2017 which if delivered, would increase Dubai's total stock to 483,000 units. Although no one, including JLL, expect anywhere near that many will be handed over by year end.
Certainly up until two to three years ago, speculators dominated the Dubai freezone market, typically cash buyers, who sought quick capital gains and weren't particularly interested in rental yields nor renting out their properties, even the completed ones.
But why would an investor not want the additional income that leasing a property would generate, especially with Dubai's rental yields in the high single digits? There are a number of reasons.
Some of these properties were purchased for recreational purposes. Dubai with its year-round sunshine, fabulous facilities and welcoming nature has been and will remain a favourite destination for the well-heeled of the region and from around the world. For cultural reasons, some owners will not rent a property purchased for personal use, even if it's vacant for 360 days of the year. Though household budgets are being squeezed, I don't see that changing.
The main culprit was Dubai's rental regulations with its rent caps and long notice periods to vacate, which are heavily weighted towards tenants. While great for tenants, they can limit an owner's flexibility to do what they want with the property. Properties that are vacated on possession are often advertised and sold at a premium.
But with prices falling now for three years, many are reassessing and some have added their properties to the rental pool which has increased supply. These coupled with new project handovers and a decrease in employment within the petrochemicals and related sectors, has increased supply, causing rents to decline.
Again, good news for tenants but it hasn't been all bad news for owners.
Some of the more savvy owners of studios and one-bedroom apartments are increasingly capitalising on Dubai's transient nature and its popularity for business and leisure by furnishing their apartments and offering them for rent on a short-term basis. Such apartments, particularly those in Dubai's most popular areas, can achieve net double digit returns even after one takes into consideration high vacancy rates and 20 per cent to 30 per cent management fees.
Renting out property for periods of less than six months is classified as holiday letting and therefore comes under the jurisdiction of Dubai's tourism department, not the real estate regulator, and so rent caps and notice periods are not applicable. This gives owners more flexibility should they choose to sell or use the property.
Short term is becoming increasingly popular with owners of small apartments but is a less viable option for large apartments and villas which are not as popular with the short-term demographic.
Despite the falling prices, some owners from the UK and Europe are liquidating UAE assets to take advantage of currency profits due to a strong dollar and historically low GBP/euro following Brexit. Typically, they are selling to mortgaged buyers looking to get onto the property ladder while prices within reach, being at their lowest point since late 2012.
So, despite a fall in property prices, a low oil price and a sluggish regional economy, it's certainly not all bad news; rents are down which is great if you're a tenant, prices are down which is good if you're a buyer, the dollar is strong which is good news if you're a seller, and there's more short-term accommodation on offer if you're passing through.
The writer is CCO of propertyfinder Group. Views expressed are his own and do not reflect the newspaper's policies.
Pecker is a key witness in the case against the former US president, who is accused of falsifying business records to cover up hush-money payment
The oil and gas conglomerate and Fifa, the world governing body, sign major sponsorship agreement
Toomaj Salehi risks being hanged after the conviction on the Shariah charge of "corruption on Earth" by a Revolutionary Court
Aid groups warn any invasion would add to already-catastrophic conditions for Gaza's 2.4 million people
The American they will face Australia and Serbia on July 15 and July 17 as part of their preparation for the Paris Olympic Games
The leaders emphasise that the deal to release the hostages would bring an immediate and prolonged ceasefire in Gaza
Dubai-based Sumit Augustine has had a philosophical approach towards spending
The regional upswing also defies oil production cutbacks