Experts: UAE banks unprepared for real estate bubble burst in coming years
Emirate banks will be hard hit if the current real estate bubble experienced in the UAE were to burst, industry experts maintain.
Over the past three years, Dubai property prices have grown by nearly 100 percent, transforming it into the regional tourism and trade hub.
In turn, fears have been raised of a possible sudden drop in prices, according to Khaleej Times. Nonetheless, new construction projects such as luxury residences continue to expand.
A real estate market correction, according to experts, will likely occur in the coming five years as the number of new housing units available for buyers grows.
Meanwhile, banks lack the necessary market indicators to assess the risks related to their exposure through their involvement in the real estate market, which remains substantial enough to seriously harm them were the industry to collapse suddenly.