Central Bank says UAE property market may see imbalances, overheating
The UAE central bank has said low residential rental yields in Dubai and Abu Dhabi may indicate growing imbalances and overheating in the real estate sector, the first official warning about soaring property prices in the Gulf country, Reuters has reported. House prices in Dubai soared 27.7% from a year ago in January-March, leading the global rankings for a fourth straight quarter, according to consultancy Knight Frank. “Current average rental yields in Dubai and Abu Dhabi are approximately 70 and 130 basis points below historical averages, which could indicate growing imbalances – (an) overheating real estate market,” the central bank said. “Monitoring developments in the UAE real estate markets and the banks’ exposure to it remains a core financial stability priority,” it added.