UAE property market could benefit from break with dollar
UAE property market could benefit from break with dollar
The housing market in the United Arab Emirates (UAE) could receive a boost as a result of the current global crisis rocking the financial world, if it decides to break its bond with the US dollar and go it alone, as Homes Overseas reports.
The fact that the
UAE Dirham (AED) is fixed to the US dollar means that the two currencies do not fluctuate against each other and as such retain one, fixed, value. This does however mean that the UAE Central Bank has to apply US interest rate policy. There is now talk of the UAE breaking free from the US, as fear of inflation in the UAE mounts.
David Nicholls of property investment company EM Concepts feels that a break from the US would be a good thing for the UAE's property markets and British investors: "If the AED does break free from the US dollar, then the value of the Arabian currency is likely to appreciate very quickly, which will translate back to a greater return to the investor when the AED-based property asset is sold and funds returned to the UK."
At present, the property market in the UAE is recording strong growth and the tourism trade is also on the up.
10 June 2008
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