Credit vs confidence

Whether you call it a credit crunch or a confidence crunch, the fact remains that most buyers are apprehensive, to say the least. Goldline Finance Limited's managing director Mamad Kashani Akhavan says, "The problems began with the banks refusing to lend money. Therefore, it isn't the classic case of whether the chicken came before the egg. Clearly, everything began with a credit crunch. However, it has subsequently turned into a confidence crunch as investors are now afraid of investing their money."

Essentially, Mamad wants to reassure end-users that there are opportunities to be had. "The interesting point to remember is that there are trillions of dollars of bank deposits all over the world earning no interest for account holders. Once this irrational fear has gone, investors will again have the confidence to start buying. Given all the recent financial problems, I strongly believe that property investment will become a safe haven for many of these investors."

Mamad believes that Dubai is still a lucrative place to invest in. "There are people wanting to set up business in Dubai, tourists wanting to visit and people wanting to buy property as their main residence or holiday home. In my opinion, this will be the catalyst for aiding the recovery of the economy."

In terms at the future of the property market, Mamad makes a hugely optimistic prediction. "Provided we are looking at the value of genuine prime properties (ie, high quality properties in desirable locations), I believe that they will not only reach the peak of 2008 values, but will surpass them."

On a somewhat less optimistic note, he observes that the remainder of 2009 will be difficult, especially as Dubai is going through a major transition period. "The speculators who had previously dominated the Dubai market are now being replaced by long-term investors and end-users. This is a healthy process, but will, no doubt, take time."

Although it's difficult to predict when a market will bottom out, he is adament that for long-term investors, there are still opportunities available, in which prime properties can be purchased at good prices.

"When these opportunities arise, investors should not let them pass by in the hope that there may possibly be better opportunities if they wait a bit longer," says Mamad.

Goldline Finance Limited's managing director Mamad Akhavan shares his optimism about the Dubai real estate market.