Dubai housing market slump hits Brits

Estate agents in Dubai today spoke of the "appalling" state of the housing market in the city — but expressed hope of an eventual recovery.

House prices across much of the emirate have halved in value in the last 12 to 18 months, and analysts reckon they could fall another 30% by the end of next year.

It has left many Brits who moved to Dubai and bought houses during the boom sitting on huge losses.

Jeremy Mayhew-Sanders, head of investments and development at property consultant Sherwoods in Dubai, said: "The market was pretty appalling out here anyway. There are not a lot of transactions taking place.

"It has been the most staggering year and a half to see things literally come to a halt, and Dubai is going to go through another rocky patch.

"But Dubai has very good reasons to exist in terms of where it is and what it offers.

"That will remain to be the case and although it will take time that is what will pull Dubai through."

Some 40,000 homes are expected to be built in the next two years, but with nearly a quarter of completed properties already empty many look set to remain vacant.