Property prices and rents in the United Arab Emirates may fall a further 20 percent in 2011 and 2012 due to oversupply, financial services firm Arqaam Capital said. "We think there is a further leg down to the UAE property market before residential prices and rents recover. We see a further 15 percent to 20 percent in downside to prices and rents in the financial year 2011-201212," analyst Mohammad Kamal wrote in Arqaam Capital's report on UAE real estate. "Genuine revival triggers will only appear in a broad macroeconomic recovery, via job creation, a rise in discretionary spending, continued regulatory evolution, resumed mortgage lending, and growth in tourist flows," Kamal said. Neighboring Abu Dhabi's real estate market is also likely to see further pressure in the fourth-quarter (Q4) of 2011. According to a recent report by property consultants Jones Lang LaSalle (JLL), an additional 11,000 homes are scheduled for completion in Abu Dhabi by Q4 2011. "Up to 11,000 units are scheduled for completion, but some of these projects may experience further delays in the final stages of permitting," the report said. Future supply is mainly comprised of units at Marina Square, Etihad Towers, and Al Reef villas and apartments.
