DUBAI - Profits in Dubai’s buoyant real estate sector could ease and sales slow in certain areas, but the overall outlook remains positive, Director-General of the Lands Department Sultan Butti bin Mijrin said on Wednesday.

Mijrin said buyers had become very selective in property investments in the wake of the global credit crisis.

Addressing fears that fallout from the liquidity crunch could reverberate throughout Dubai’s real estate sector, Mijrin said: “The correction in profit levels will not be felt across Dubai as it will be limited to some areas only.

“The outlook for the sector remains positive with registered property sales so far this year reaching Dh200 billion,” he said.

His remarks came in the wake of recent research reports by analysts predicting a drop in property prices, which have risen 14.4 per cent since January 1.

Saudi Arabian bank Samba has said signs of an emerging overheating in Dubai’s property sector could raise the risk that a significant imbalance may develop over the next two years as new supply comes on to the market, increasing the prospect of a sharp correction. Investment bank EFG-Hermes has said soaring real estate prices were set to peak in the first half of 2009 before a decline in the second half of the year when 70,000 units are expected to come on stream. Abu Dhabi-based Sorouh Real Estate Chief Executive Mounir Haider said the global credit crunch could hurt developers in the UAE, slowing expansion plans.

“The health of the financial markets worldwide is linked to the UAE and we are hoping the global crisis will be over soon,” he said. Shehab Gargash, chief executive officer of Daman Investments, pointed out recently that the prevailing high property prices were not sustainable and a slowdown was likely.

Marwan bin Ghulaita, CEO of the Lands Department, said all property sales to be conducted at the upcoming Cityscape Exhibition would have to be logged with the department.

Khaleej Times Online - Property Profits may Fall in Some Areas of Dubai

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