Property in Dubai 'may offer long-term investment'

People looking to purchase an overseas property may wish to choose property in Dubai, as experts predict prices will rise in two years.

Recent analysis of the market shows that prices could fall by as much as 50 per cent this year, which may boost the number of bargain-hunting investors entering it.

This may then offer long-term gains, as the price of homes is expected to return to normal levels by 2011, says Sajeer Babu, an Equity Analyst at the National Bank of Abu Dhabi.

He predicts that the cost of property in Dubai may fall further still before then, as "the magnitude of the problem in the sector is still high and the recovery of the sector may take some more time".

The estimates are backed up by recent figures revealed by sector analyst Knight Frank, which show that prices in the emirate have fallen by 40 per cent since the fourth quarter of 2008.