# Dubai's six-year building boom grinds to halt as financial crisis takes hold



## luv2bebrown (Nov 4, 2004)

Xusein said:


> Dubai grew too fast too quick, a halt was inevitable.


what halt are you talking about? dubai is still growing.


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## ale26 (Sep 9, 2005)

I'm happy I live in Canada which is actually weathering this storm pretty damn well...people here are all still spending, working, entertaining.. I know were just renovating our house now and I know quite a few people who are

I'm not saying our economy isn't hurting at all but compared to other countries (especially the U.S) were doing well, especially our banks. The malls are always packed, people are buying bmw's, mercedes, audi's, etc like crazy I don't know, Hopefully we'll be ok


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## Xusein (Sep 27, 2005)

luv2bebrown said:


> what halt are you talking about? dubai is still growing.


Okay, a _slowdown _was inevitable.


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## luv2bebrown (Nov 4, 2004)

Xusein said:


> Okay, a _slowdown _was inevitable.


can't argue with you there brother!


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## nygirl (Jul 14, 2003)

AltinD said:


> I don't know how NYC is doing but aren't they selling elswhere in the country re-possesed houses for $1 ?


Aside from what I read about the banks and job losses felt by some here things look and feel like normal. I do things the same way I did before this disaster turned global. I'd say we know whats going on and we know that times are tough and unless you have really been hit hard by the financial crisis New York City just doesn't seem any different than it did in the summer of '07 and '06. 

When I start seeing soup lines and the distopian feel of the 80's reemerge along with degentrification and subways painted in graffitti I will be the first to inform everyone (and I know there are folks who want to see NY looking like it did in the 80's for some sort of sentimental reason). I'd say in brief its the same sht, different day...not much feels different.


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## Get Smart (Oct 6, 2008)

krull said:


> ^^ We already have bad news in America. Where have you been? :dunno: Maybe that is why Dubai has been affected? Maybe you don't want us to have more bad news. It could be worse for Dubai.


are you suggesting i want to hear more bad news from NYC? if thats the case, you are wrong pal, what i worry about is another surprise that will come from Broken Apple (NYC) and wreck our lives here in UK and elsewhere in the world. today i open paper and 800+ british jobs lost at the BMW mini plant in UK. These unemployed but highly skilled people have families to support and that means more taxes from me and others. :bash: anything bad happens in Dubai will not affect UK greatly, whereas america is the biggest Satan as far as British jobs are concerned. 





krull said:


> It is one of the most talk about cities in SSC, so it makes sense to post news about it. Either positive or negative. I already posted a 'negative' story about NYC economy... Half-built sites cast shadow over NY economy
> 
> So suck it up and let people here read the article. Also the problem with Dubai is that many people are actually trying to abandon their properties and leave the city. Not the case with NYC. At least not yet.


most of the people leaving Dubai are foreigners, so what they will leave, and go back again when things are better. I dont know about people abandonimh and leaving NYC, but in other parts of amerca people are 

Homeless and sleeping in Cars in Car Parks. VERY SAD






^^ also as a New Yorker, you should be worried about the rough ride coming your way, and oh yeah enjoy the commentary from a New Yorker 

:badnews:


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## nygirl (Jul 14, 2003)

Lol. Wow what a bunch of dooms day theorists and fear mongers we have here. Take it easy folks it isn't like we haven't seen rough economic times before. Dubai, like NYC will bounce back as soon as we get the balls rolling again. In the mean-time take each day in stride if you feel so affected. "The only thing we have to fear, is fear itself"-FDR 

NYC is very resilient. So whatever rough ride is coming our way we will take it and roll with the punches. New York is no stranger to rough rides and economic down turns. People thought it would never climb back from the 70's and it did. People probably thought the same thing back in 1930 and it bounced back. The 19th century saw really bad times though not at the same scale as today, for the time they were depressions. 

I won't even click on those youtube videos any longer because its just a copy of wpix news broadcast with some loud, foul mouth, low class brooklyn, queens, or Bronx trash just babbling like a baffoon.

Seriously people, take that video's commentary with a big ole grain of salt. 

Broken Apple---far, far from it. I'll bet the "broken apple" comes out of this just fine in the end. Quit thinking this is the end of the world....it isn't. P.S. I'm not sure how many people are leaving New York but like I said...it doesn't really feel, or look any different. This will all blow over.................it ALWAYS does.


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## krull (Oct 8, 2005)

^^ Seriously nygirl. :lol:

Anyway Get Smart, NYC has nothing to do with what is happening with the UK. So no, NYC is not broken. It is the overbuilt housing in places like Phoenix and Las Vegas, among other cities that has caused much of the trouble. But please before you blame America for your failures, blame YOUR banks. That is what we are doing here. Blaming our banks. But nobody place a gun and make them give out loans and invest in these crazy overhype places in the USA. Also the over price UK housing boom did not help so much. It exploded! So there is a lot of wrong doing in your precious country.

Also stop been obsessed with that low class clown guy that makes those useless youtube videos. hno: What, do you think he represents most New Yorkers? :lol: Well you are so wrong.

Also we are getting off topic, so don't bring America into this Get Smart. Lets talked about the troubles of Dubai. Ok.


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## Taller Better (Aug 27, 2005)

There was plenty of big risk taking in the banking industry in Britain, too.... which lead to a lot of problems in London. Can't all be blamed on the Americans... other countries have to take responsibility for the greed factor, too.


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## Xusein (Sep 27, 2005)

^^Yeah, I was about to say. As if the recklessness in the City and the massive housing bubble in the UK (which was bigger than the one in the US) wasn't responsible for the current problems there. However, the problems in Dubai, IMO, aren't as bad as in London or NYC.


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## Koen Acacia (Apr 17, 2007)

Xusein said:


> ^^Yeah, I was about to say. As if the recklessness in the City and the massive housing bubble in the UK (which was bigger than the one in the US) wasn't responsible for the current problems there. However, the problems in Dubai, IMO, aren't as bad as in London or NYC.


The whole thing started on Wall Street though. A lot of people over here (outside London as well) thought for some reason that they could trust those credit rating agencies for example.
To say that the whole global crisis that broke out after Bear Stearns went down "has nothing to do with the Americans" sounds a bit strange imo.


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## OtAkAw (Aug 5, 2004)

This is expected.


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## pokistic (May 8, 2007)

Oh Dubai. I feel sorry for the people here that really wanted this place to be a success.

Also is sad how everyone keeps blaming America for their own failures. :nono: Stop been so delusional and fix your own problems.


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## Homer J. Simpson (Dec 2, 2003)

Corrections in the markets happen. There is no ending that phenomenon.

Dubai may more may not survive in the long run but how many centers of wealth remain for centuries? 

In the mean time this little slowdown may actually benefit Dubai by giving the people in higher office a reality check.


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## Koen Acacia (Apr 17, 2007)

pokistic said:


> Also is sad how everyone keeps blaming America for their own failures. :nono: Stop been so delusional and fix your own problems.


In hindsight, I worded that rather badly. Saying "this is America's fault OMFG!" isn't going to fix anything. But saying "just worry about your own problems" isn't going to do anything either. 
Finance has simply become too global for that, it's like saying that all you need to control the quality of your food is to make sure that your city's cows are well-treated: that doesn't going to matter all that much if 99 percent of your meat is imported from other cities.


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## Taller Better (Aug 27, 2005)

I think the point is that this situation has underlined that financial institutions in countries other than the USA were doing exactly the same things that lead to big losses. Tighter national restrictions in the UK would have prevented a lot of pain, but the temptation to bet the farm and make huge fast profits is very strong (and Iceland very much regrets betting the farm). The meltdown began in the States, but it is unfair to blame high risk activity in London on high risk activity in the USA. That is sort of like calling your twin brother ugly.


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## Koen Acacia (Apr 17, 2007)

Taller said:


> I think the point is that this situation has underlined that financial institutions in countries other than the USA were doing exactly the same things that lead to big losses. Tighter national restrictions in the UK would have prevented a lot of pain, but the temptation to bet the farm and make huge fast profits is very strong (and Iceland very much regrets betting the farm). The meltdown began in the States, but it is unfair to blame high risk activity in London on high risk activity in the USA. That is sort of like calling your twin brother ugly.


That *some *other people were also poisoning their cattle still doesn't mean that it's OK to poison cattle, or that we shouldn't start thinking up ways to make sure that the meat that our traders are buying hasn't been poisoned in any way.


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## Taller Better (Aug 27, 2005)

I honestly do not understand your point. If other countries feel more comfortable laying the blame at the foot of the USA rather than face the fact that their national regulators had gotten slack and allowed rampant greed and risk taking, then so be it. But in this case I think it is rather a case of insisting a duck is a swan. Canada was often ridiculed as being a stick in the mud for having strict federal regulations, but now is reaping the benefits by weathering the economic storm better than the rest of the G8. It all boils down to regulations, and taking responsibility for one's actions when the party ends. I think it behoves the citizens of every nation to ask some hard questions of their own federal government, and of their own financial institutions as to why they have melted down, and what can be done in the future to prevent it happening again. We have learned that deregulation and assuming the banking industry will self regulate to protect itself has had some pitfalls.


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## Koen Acacia (Apr 17, 2007)

Taller said:


> I honestly do not understand your point. If other countries feel more comfortable laying the blame at the foot of the USA rather than face the fact that their national regulators had gotten slack and allowed rampant greed and risk taking, then so be it. But in this case I think it is rather a case of insisting a duck is a swan. *Canada was often ridiculed as being a stick in the mud for having strict federal regulations, but now is reaping the benefits by weathering the economic storm better than the rest of the G8. *It all boils down to regulations, and taking responsibility for one's actions when the party ends.


That, right there, is my point. Some Dutch banks also went way too far in buying up repackaged mortgages which later turned out to be toxic. In hindsight, I think that that should never have been allowed, but it was.
Criteria for _local _mortgages have always been reasonably strict but that doesn't matter as long as they can just import all sort of foreign stuff without knowing what it actually is that they're buying.


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## Taller Better (Aug 27, 2005)

I think it would be a good idea for industrialized countries to go back to the regulations of the last generation when it comes to financial institutions. Apparently if you let the fox guard the henhouse, all sorts of nasty things will eventually happen! It is less glamorous to control risk, and the dividends are sometimes not as high... but neither are the losses.


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## Xusein (Sep 27, 2005)

Koen Acacia said:


> The whole thing started on Wall Street though. A lot of people over here (outside London as well) thought for some reason that they could trust those credit rating agencies for example.
> To say that the whole global crisis that broke out after Bear Stearns went down "has nothing to do with the Americans" sounds a bit strange imo.


I never said it has nothing to do with the Americans, obviously it started here. Don't know where you got that idea. Just saying...a lot of other countries financial systems were willing to drink up the spiked punch bowl with Wall Street, and that can't be discounted, _especially _London...which for a time had even looser regulations than Wall Street.


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## Tom_Green (Sep 4, 2004)

This is a skyscraper forum. Let`s talk about skyscrapers.

90% of all skyscrapers with 300m and more are still u/c in Dubai. Does it look like a collapse? Dubai is slowing. That`s all.


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## Xusein (Sep 27, 2005)

^ I got a bit off-topic, lol. :yes:


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## pokistic (May 8, 2007)

Ok lets get back to DUBAI! Here are some interesting yet depressing videos about Dubai...


*Dubai Real Estate Crash*





*Dubai Property Market Collapse*





*Dubai Real Estate Bubble has Burst*


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## Gerrad (Dec 17, 2006)

I can't help but feel a slight bit of schadenfreude. But that's all I'll say.


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## nygirl (Jul 14, 2003)

^^ One of my favorite words to use is Schadenfreude. Even though thats kind of a low blow...good usage.


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## helghast (Oct 23, 2007)

ok. lets make one thing clear. Dubai's Real Estate Bubble has NOT Burst.


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## bayviews (Mar 3, 2006)

helghast said:


> ok. lets make one thing clear. Dubai's Real Estate Bubble has NOT Burst.



It's very resassuring to hear that. I had been a bit concerned about after reading this article. 


Laid-Off Foreigners Flee as Once Booming Dubai Spirals Down 
New York Times, The (NY) - Thursday, February 12, 2009 
Author: ROBERT F. WORTH Ali al-Shouk contributed reporting. 

Abstract: Dubai , once hailed as economic superpower of Middle East, now looks like ghost town as laid-off foreign workers desert city by tens of thousands; plunging economy forces foreigners, who make up 90 percent of work force, to leave behind luxury possessions and unpaid debt; government remains unwilling to provide exact data, giving rise to rumors which damage confidence and undermine economy even further; photos (M) 
Sofia, a 34-year-old Frenchwoman, moved here a year ago to take a job in advertising, so confident about Dubai 's fast-growing economy that she bought an apartment for almost $300,000 with a 15-year mortgage. 

Now, like many of the foreign workers who make up 90 percent of the population here, she has been laid off and faces the prospect of being forced to leave this Persian Gulf city -- or worse. 

"I'm really scared of what could happen, because I bought property here," said Sofia, who asked that her last name be withheld because she is still hunting for a new job. "If I can't pay it off, I was told I could end up in debtors' prison." 

With Dubai 's economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield. 

The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month. That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai -- once hailed as the economic superpower of the Middle East -- looking like a ghost town. 

No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai 's major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy. 

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country's reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis. 

Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubai 's Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher. 

"At the moment there is a readiness to believe the worst," said Simon Williams, HSBC bank's chief economist in Dubai . "And the limits on data make it difficult to counter the rumors." 

Some things are clear: real estate prices, which rose dramatically during Dubai 's six-year boom, have dropped 30 percent or more over the past two or three months in some parts of the city. Last week, Moody's Investor's Service announced that it might downgrade its ratings on six of Dubai 's most prominent state-owned companies, citing a deterioration in the economic outlook. So many used luxury cars are for sale , they are sometimes sold for 40 percent less than the asking price two months ago, car dealers say. Dubai 's roads, usually thick with traffic at this time of year, are now mostly clear. 

Some analysts say the crisis is likely to have long-lasting effects on the seven-member emirates federation, where Dubai has long played rebellious younger brother to oil-rich and more conservative Abu Dhabi. Dubai officials, swallowing their pride, have made clear that they would be open to a bailout, but so far Abu Dhabi has offered assistance only to its own banks. 

"Why is Abu Dhabi allowing its neighbor to have its international reputation trashed, when it could bail out Dubai 's banks and restore confidence?" said Christopher M. Davidson, who predicted the current crisis in " Dubai : The Vulnerability of Success," a book published last year. "Perhaps the plan is to centralize the U.A.E." under Abu Dhabi's control, he mused, in a move that would sharply curtail Dubai 's independence and perhaps change its signature freewheeling style. 

For many foreigners, Dubai had seemed at first to be a refuge, relatively insulated from the panic that began hitting the rest of the world last autumn. The Persian Gulf is cushioned by vast oil and gas wealth, and some who lost jobs in New York and London began applying here. 

But Dubai , unlike Abu Dhabi or nearby Qatar and Saudi Arabia, does not have its own oil, and had built its reputation on real estate, finance and tourism. Now, many expatriates here talk about Dubai as though it were a con game all along. Lurid rumors spread quickly: the Palm Jumeira, an artificial island that is one of this city's trademark developments, is said to be sinking, and when you turn the faucets in the hotels built atop it, only cockroaches come out. 

"Is it going to get better? They tell you that, but I don't know what to believe anymore," said Sofia, who still hopes to find a job before her time runs out. "People are really panicking quickly." 

Hamza Thiab, a 27-year-old Iraqi who moved here from Baghdad in 2005, lost his job with an engineering firm six weeks ago. He has until the end of February to find a job, or he must leave. "I've been looking for a new job for three months, and I've only had two interviews," he said. "Before, you used to open up the papers here and see dozens of jobs. The minimum for a civil engineer with four years' experience used to be 15,000 dirhams a month. Now, the maximum you'll get is 8,000," or about $2,000. 

Mr. Thiab was sitting in a Costa Coffee Shop in the Ibn Battuta mall, where most of the customers seemed to be single men sitting alone, dolefully drinking coffee at midday. If he fails to find a job, he will have to go to Jordan, where he has family members -- Iraq is still too dangerous, he says -- though the situation is no better there. Before that, he will have to borrow money from his father to pay off the more than $12,000 he still owes on a bank loan for his Honda Civic. Iraqi friends bought fancier cars and are now, with no job, struggling to sell them. 

"Before, so many of us were living a good life here," Mr. Thiab said. "Now we cannot pay our loans. We are all just sleeping, smoking, drinking coffee and having headaches because of the situation."


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## crawford (Dec 9, 2003)

helghast said:


> ok. lets make one thing clear. Dubai's Real Estate Bubble has NOT Burst.


Uh, prices have dropped 40% in six months. Is there a bigger drop anywhere on the planet? 

Maybe Dublin or Reykjavik?

And oil-rich Abu Dhabi claims they won't bail-out Dubai. If this is true, Dubai is finished.


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## Tom_Green (Sep 4, 2004)

crawford said:


> Uh, prices have dropped 40% in six months. Is there a bigger drop anywhere on the planet?
> 
> Maybe Dublin or Reykjavik?


Is this bigger for you?
*Would You Pay $103,000 for This Arizona Fixer-Upper?*


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## crawford (Dec 9, 2003)

^
Nope, not even close.

Phoenix prices haven't dropped anything close to 40% over the last six months. 

They've dropped by about 45% over the last two years; maybe a third of that over the last six months.


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## Jakes1 (Apr 28, 2006)

Over half UAE construction projects on hold-report 

Reuters - Friday, February 6DUBAI, Feb 5 
More than half of the construction projects in the United Arab Emirates, worth $582 billion, have been put on hold, with more expected to be deferred in 2009 due to the global crisis, a market research firm said. A report by Dubai-based Proleads said 52.8 percent of projects were on hold while a further $698 billion-worth remained in progress.

"Within the real estate sector, it is likely that we will witness more deferred projects throughout 2009 as will be the case, but to a lesser degree, within the infrastructure sector," the report said.

The report looked at 1,289 projects in January in real estate, infrastructure and leisure and entertainment in the Gulf Arab state.

The construction industry in the UAE, and in Dubai in particular, is facing a sharp slowdown as a result of the economic crisis, as property prices fall, jobs are cut and projects are axed.

Morgan Stanley said this week some $263 billion worth of projects in the UAE had been delayed or cancelled and property prices had fallen by an average of 25 percent since their peak in September.

Deyaar Real Estate said on Wednesday it was putting on hold at least 25 percent of its projects while private developer Damac announced further job cuts


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## Dubai_Boy (May 21, 2003)

crawford said:


> Uh, prices have dropped 40% in six months. Is there a bigger drop anywhere on the planet?
> 
> Maybe Dublin or Reykjavik?
> 
> And oil-rich Abu Dhabi claims they won't bail-out Dubai. If this is true, Dubai is finished.


Actually you missed a very important point.

Im considered lower middle here in the UAE. I depend on my salary as my main source of income. So for the last 8 - 9 years the closest i ever got to owning a Dubai or Abu Dhabi property was printing out a picture of a tower from skyscrapercity and putting it in my pocket (gave me a warm fuzzy feeling) ....

Prices were sickening , disgusting and only for the ultra rich or people who were mad enough to spend ALL their life savings on an apartment that was 30 times over priced ......

Do you know what has been happening for the past week ?

Well , apartments and villas that used to go for lets say 10 million are actually worth only 2 or 2.5 million tops are now selling for 2 million and 1.6 even

People like me , actually my father , and two brothers and not to mention half the people i work with are getting INCREDIBLE offers from banks in the form of loans to purchase these properties ... properties that were the play ground of greedy bastards for 8 years have finally come to the "people" of the UAE so to say ....

Im getting myself a villa now , 4 bedrooms and 4 bathrooms and 2 parking spaces and a small garden for 2 million that USED to go for almost 7 million

And its not only me my friend , LOADS of people are doing the same because its just an impossible bargain to pass

Dubai and the UAE as a whole have been "hit" .... but collapsed ? the end of ? dooms day ?

pffft what ? :cheers:

Ok i got carried away at the end there but come on , stop the boring doomsday scenarios !:nuts:


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## Dubai_Boy (May 21, 2003)

Jakes1 said:


> Over half UAE construction projects on hold-report
> 
> Reuters - Friday, February 6DUBAI, Feb 5
> More than half of the construction projects in the United Arab Emirates, worth $582 billion, have been put on hold, with more expected to be deferred in 2009 due to the global crisis, a market research firm said. A report by Dubai-based Proleads said 52.8 percent of projects were on hold while a further $698 billion-worth remained in progress.
> ...


If half the PROPOSED projects have been put on hold then that amazing news dont you think  ...... most if not all projects that broke ground are going ahead non stop and if its really really looking bad for some companies then they are simply scaling them down ..... i can see much worse cases around the world.

We still have trillions to splash around , but when consumers lost some confidence and people arent willing to spend money like before , the government will automatically stand back and watch and observe and get back on track when things calm down and people loosen up again


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## luv2bebrown (Nov 4, 2004)

yeah basically these articles are painting a picture of hundreds of half-completed towers standing empty and lifeless... which is obviously not the case.

but Dubai_Boy... you would hardly be classified as "lower middle class." at the very least you'd be upper middle class. i am lower middle class... and my salary is my ONLY source of income.


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## Dubai_Boy (May 21, 2003)

According to Abu Dhabi standards , i would be ashamed to put myself in the league of friends i have that used to get pocket money during college years 9 times more than my current salary , think that dining at 5 star hotels every night was the norm and driving a new car every 2 months 

im lower middle class buddy !


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## AltinD (Jul 15, 2004)

crawford said:


> ^
> Nope, not even close.
> 
> Phoenix prices haven't dropped anything close to 40% over the last six months.
> ...


So the current prices in Phoenix, compared to 2 years ago, have dropped by 45%?

If you want to be picky, then if we compare the prices in Dubai 2 years ago, with the current prices, they might record a very minimal drop if not any at all.


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## city_thing (May 25, 2006)

Tom_Green said:


> This is a skyscraper forum. Let`s talk about skyscrapers.
> 
> 90% of all skyscrapers with 300m and more are still u/c in Dubai. Does it look like a collapse? Dubai is slowing. That`s all.


I think looking at the occupancy rates would be a better way of determining how dubai is handling the crisis. does anyone have any recent figures or do they not get released there?


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## luci203 (Apr 28, 2008)

propreties in Dubai (like all over the world) where overpriced. they just comme to normal.

no way in hell a small 2 bedroom apartment should cost more than 100,000 $ (anywhere)

the prices where up, because of all kinds of speculators.


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## Taller Better (Aug 27, 2005)

They still have debtors' prison in Dubai!?!?! Is it for everyone, or just foreigners?


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