Turmoil in Global Banks: The First Effects on Dubai

The crisis in global finance has intensified sharply in recent days, with major international banks under severe strain and credit markets effectively frozen. The UAE authorities have moved to reassure markets, signalling support for liquidity in the banking system. For Dubai's property market, the effects of the global crisis are arriving quickly.

Why the global crisis matters here

• Bank liquidity: local banks depend partly on international funding, which has become scarce.
• Developer finance: funding for projects is harder and more expensive to obtain.
• Buyer confidence: international and local buyers are pausing decisions.
• Investor wealth: losses in global markets reduce the capital available for property.

Measures to support liquidity

Authorities across the region are taking steps to support their banking systems. In the UAE, measures to ensure liquidity are designed to keep banks lending and to prevent a loss of confidence. Their effectiveness will become clearer over the coming weeks.

What buyers and owners should expect

In the short term, transaction activity is likely to fall sharply as buyers wait for clarity. Mortgage approvals may slow. Sellers who need to sell quickly may face difficult conditions. Prices, particularly for speculative off-plan contracts, may come under pressure.

What to do now

• Avoid panic decisions; assess your position calmly.
• Confirm how upcoming instalments will be funded.
• Speak to your bank early if you rely on financing.
• Keep in contact with developers about project progress.

Longer-term perspective

Dubai's fundamentals, its location, infrastructure and role as a regional hub, have not changed. But the market had grown on the assumption of easy credit and rising prices, and that assumption is now being tested.

Our view

This is a period for caution and careful planning. We are working closely with clients to review commitments, secure financing and avoid decisions made under pressure.