Abu Dhabi// An Arab League official warned yesterday that the Gulf region could face a property market crash if the area were struck by a political crisis or the demand on houses dropped drastically. Refat al Faouri, director of Arab League's Arab Administrative Development Organisation (AADO) said: "A mortgage crisis can happen here in two cases. One if supply exceeds demand. Two, if a political and military problem breaks out."
Dr Refat, however, assured investors and property owners that for now "property investment in the Gulf is moving in the right direction and that's a natural result of stability and availability of capital." He made his remarks during a press conference to announce the launch of a the first Arab property and urban development conference. It will be organised in the capital in co-ordination with Abu Dhabi's Chamber of Commerce on October 26-28, 2008.
Dr Refat said that the region's property market enjoyed a number of strengths that would keep the momentum of the current construction boom going. They include availability of capital, increasing population and the region's social and political stability. "All of these are investment attractions," he said. Nonetheless, Dr Refat continued to say, the Arab world's property is dogged by a number of challenges such as the lack experience in property management, insufficient legislation, inexperience in property appraisal and lack of environment friendly buildings.
mhabboush@thenational.ae With additional reporting by Omar Zaafrani
