The United Arab Emirates should enact stronger measures to curb real-estate speculation in Dubai to prevent an “unsustainable” surge in prices, the International Monetary Fund said today.
“It’s very hard to spot bubbles until they burst,” Masood Ahmed, head of the IMF’s Middle East and Central Asia Department, said in an interview in the Gulf Arab emirate. “There is evidence that prices of real estate have been rising at a very rapid pace over the past 18 months.”
Dubai’s recovery from the verge of default in 2009 has fueled 35 percent-increase in real estate prices last year, according to broker Knight Frank LLP. That has sparked concerns that the emirate is at risk of repeating the 2008 property crash. Dubai’s benchmark DFM General Index (DFMGI) for stocks has jumped 59 percent this year, the biggest increase among more than 90 measures tracked by Bloomberg globally.
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