Connect with us

Economics

CEO of property firm Damac expresses concerns over ‘expensive’ Dubai

Published

on

Dubai's property market will continue to grow, DAMAC chairman says

DUBAI, United Arab Emirates — Dubai’s property scene is showing no sign of cooling off, as 2024 is on track to be another record year in terms of sales figures and property values, according to local real estate firms.

Increasing demand for property, especially in the luxury space, is boosting prices not just of homes, but of everything else in the city — just as the United Arab Emirates is expected to emerge as the world’s top wealth magnet for the third consecutive year.

For Hussain Sajwani, chairman of Dubai property giant Damac, that spells both good and bad news.

“What concerns me a little bit in Dubai is that [it’s] becoming an expensive city, and I’ve said this in the past, that Dubai [is] going to be [an] expensive city. Because whenever there is so much demand, and especially when talented people, average people are coming, they create more demand,” Sajwani told CNBC’s Dan Murphy from Riyadh on Tuesday.

“So today, to get a seat in a school is difficult … and of course, the business is going to raise prices, and inflation [is] going to be high, so Dubai is going to be an expensive city,” the chairman said. “And I hope [the] government find ways and means. And it’s not easy to find ways and means when there is a continuous influx of people to the city.”

The latest Dubai property market numbers tell a story of burgeoning demand. In July of 2024, property sales reached 49.6 billion dirhams ($13.5 billion), a 31.63% increase from the same period in 2023, according to locally-based brokerage firm Elite Merit Real Estate.

“The first half of 2024 alone saw over 43,000 property transactions valued at approximately AED122.9 billion, marking a 30% increase from the previous year,” the firm’s report released on Sept. 10 wrote, adding that the growth is due in part to the “rapid absorption of new inventory.” Around 80% of the units launched since 2022 have already been sold, the report estimates.

Aerial view of cityscape and skyscraper at sunset in Dubai Marina.

Lu Shaoji | Moment | Getty Images

“The Dubai property market is doing extremely well, and I think we’re going to continue to do well, because the demand in Europe is amazing,” Sajwani said. “Everybody wants to go to Dubai, from the taxi driver to the waiter to the businessman … Dubai now is attracting a lot of not only wealthy people, but a lot of talented people. And it’s growing in a different level from pre-Covid.”

The Damac founder noted the way in which the Covid-19 period supercharged Dubai’s popularity as a place to live: while much of the world remained in lockdowns, the emirate encouraged tourism and attracted new residents with the help of visas for remote workers and entrepreneurship.

“Dubai today is a global city, by all means, and attracting a lot of talent and a lot of businesses, we’re going to continue to grow,” Sajwani said.

Dubai has experienced a volatile boom-and-bust cycle in the past, most notably during its 2008-2009 crisis period, when the emirates’ property market crashed, and numerous investors had to default on their debts. Asked if he was worried about a similar cycle repeated itself, Sajwani expressed confidence that the system was different now.

Asked if Dubai is more stable now, Sajwani replied: “100%.”

“One of the key reason for that is that the regulations the Dubai government brought in after [the] ’09 or ’08 crash has been very good regulations. Very, very strict on developers, on customers, and on zoning,” he said. “So that regulation is helping — not everybody just can come and enter the market and just launch a project … There is very strict escrow, so the customer’s money is very much protected, and that’s what makes the market very efficient.”

Economics

Trump tariffs could cause summer economic slump: Chicago Fed president

Published

on

Austan Goolsbee, President and CEO of the Federal Reserve Bank of Chicago, speaks to the Economic Club of New York in New York City, U.S., April 10, 2025. 

Brendan McDermid | Reuters

Business owners and CEOs are already stocking up on inventory, and some American shoppers are panic buying big-ticket items in anticipation of President Donald Trump’s tariffs. The sudden buying binge could cause an “artificially high” level of economic activity, said Federal Reserve Bank of Chicago President Austan Goolsbee.

“That kind of preemptive purchasing is probably even more pronounced on the business side,” Goolsbee told CBS’ “Face The Nation” on Sunday, adding: “We heard a lot about preemptive building-up of inventories that could last 60 days, 90 days, if there [was] going to be more uncertainty.”

Businesses stockpiling inventory and consumers accelerating their purchasing decisions — buying an Apple iPhone now, say, rather than waiting until the fall — may inflate U.S. economic activity in April and lead to a slowdown in the coming months, Goolsbee suggested.

“Activity might look artificially high in the initial, and then by the summer, might fall off — because people have bought it all,” he said.

Sectors affected by Trump’s tariffs, particularly the auto industry, are most likely to heavily stock up on inventory now before import levies on goods from other countries potentially rise further, said Goolsbee. Many car parts, electronic components and other big-ticket consumer items are manufactured in China, for example, which currently faces a 145% total tariff rate on goods imported to the United States.

Trump’s tariffs on a bevy of other countries are currently in the middle of a 90-day pause, with a 10% baseline tariff rate instead applying to all imported goods across the board. The pause is due to expire on July 9, with Trump touting a series of rate negotiations with foreign leaders between now and then.

“We don’t know, 90 days from now, when they’ve revisited the tariffs, we don’t know how big they’re going to be,” Goolsbee said.

Some U.S. business owners who buy goods manufactured in China say they already can’t afford to place rush orders on inventory. Matt Rollens, owner and CEO of Granite Bay, California-based novelty drinkware company Dragon Glassware, says he’s temporarily holding his products in China because paying the 145% levy would force him to raise consumer prices by at least 50%, likely drying up customer demand.

Rollens has enough inventory in the U.S. to last roughly until June, and hopes the tariffs will be rolled back by then, he told CNBC Make It on April 11.

Short-term uncertainty and financial pain aside, the Fed’s Goolsbee expressed optimism about the country’s longer-term economic outlook.

“If we can get through this, it’s important to remember: The hard data coming into April was pretty good. The unemployment rate [was] around steady full employment, inflation [was] coming down,” he said. “It’s just a desire of people expressing they don’t want to back to ’21 and ’22, at a time when inflation was really raging out of control.”

Continue Reading

Economics

Donald Trump wants a certain kind of immigrant: the uber-rich

Published

on

IN HIS LOVE of lucre Donald Trump can be crass. In their pursuit of efficiency, free marketeers can be, too. Consider the sale of citizenship. Most people dislike the idea of treating national belonging as a commodity. Yet about a dozen countries hawk passports and more than 60, including America, offer residency in exchange for an investment or donation. Its “golden-visa” scheme is cumbersome, under-priced and inefficient. On this point the president and the market agree.

Continue Reading

Economics

Checks and Balance newsletter: The Democrats’ future is up for grabs

Published

on

Checks and Balance newsletter: The Democrats’ future is up for grabs

Continue Reading

Trending