Dubai: One of Dubai's largest developers said 2021 would be another challenging year for the sector and warned against the risk of companies "dumping" property in a market already grappling with excess inventory.
"I hope the big developers don't start dumping supply just because they can sell another few hundred villas or apartments," Damac Properties' Chairman Hussain Sajwani said. "We very strongly believe that next year will be a challenging year."
Damac's chairman has been advocating for a moratorium on construction in Dubai, where a property glut has driven home prices down by more than 30 per cent since 2014. The government was forced to set up a committee to manage supply and demand as some of the city's largest developers continued to build.
Already into it
Now, it seems many are coming around to accept the need to halt new building. After resisting calls to stop, the head of Dubai's biggest developer Emaar, Mohamed Alabbar, earlier this month said his company stopped all new construction temporarily.
Measures to curb the spread of coronavirus "have forced everybody to stop no matter if they like it or not," Sajwani said. "Everybody realizes there is too much oversupply."
Damac won't be bringing new product to the market, Sajwani said. "We have no intention of expanding because the situation still doesn't look rosy at all going forward."