GLOBAL ECONOMIC SITUATION
The Federal Reserve, the European Central Bank, and other globally influential central banks have begun reducing interest rates. Rate cuts are expected to continue through the 2025-2026 period, injecting over $7 trillion in additional liquidity into the market. This influx of capital is anticipated to flow into sectors such as the stock market, real estate, cryptocurrencies, and precious metals. As a result, investor appetite for international opportunities is expected to increase during this period, positively impacting those looking to invest in Dubai.
TURKEY’S INTEREST RATE POLICY
The Central Bank of the Republic of Turkey (CBRT) began reducing interest rates in December 2024. Rates are expected to start at 50 percent and decline to 25 percent by the end of 2025, accompanied by a similar decrease in inflation. International organizations such as JP Morgan, the IMF, and the OECD estimate that Turkey's inflation will drop to 20 percent. As interest rates decrease, the future movement of the $366 billion currently held in interest-bearing accounts remains uncertain. Historically, when interest rates were low, the total amount in these accounts averaged between $150 billion and $170 billion. Based on this, approximately $200 billion is expected to flow out of interest-bearing accounts during the 2025-2026 period. While the exact destination of this capital remains unclear, it is likely to be directed toward sectors such as stock markets, cryptocurrencies, and real estate. In 2024, Turkish investors directed $3 billion in investment to Dubai. This figure is expected to rise to $5 billion in 2025, with a similar amount anticipated in 2026.
DUBAI REAL ESTATE MARKET (2025-2030)
The UAE's national income is projected to rise from $570 billion to $800 billion between 2025 and 2030, reflecting a 40 percent increase in dollar terms. If national income grows at this rate, a similar trend is expected in real estate prices. In particular, if Dubai's population expands from 4 million to 8 million, property prices in the city are likely to rise significantly. Given the city's ongoing growth and the increase in national income, housing prices are expected to appreciate overall. However, the rate of increase may vary depending on the location and specific projects. In 2024, Dubai ranked as the seventh most-visited city globally, generating over $30 billion in tourism revenue. With a rising population and continued tourism growth, demand for shortterm rental properties is also expected to increase in the coming years. Given these trends, presenting this narrative to investors could be a compelling strategy.
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