The International Monetary Fund (IMF) has claimed that a brand new property bubble could be forming in Dubai, gulfbusiness.com reports.
In the run up to the global financial crisis of 2008, Dubai saw one of the most concentrated price bubbles on earth. This also meant, however, that when the crash came, it also suffered among the worst fates, with some state-linked companies coming close to defaulting.
Now, Dubai's property market has become much more stable, which has prompted lawmakers to consider ways of keeping it as such, by preventing more large-scale rises. They may have to act fast, however, as the IMF has claimed that history is starting to repeat itself once more.
IMF director for the Middle East and North Africa, Masoon Ahmed, said that rapid increases in asset prices needed to bring about action from the emirate's government. He did add, however, that the government of Dubai was already "beginning to act".
Ahmed's comments come after property prices in Dubai rose by more than 20 per cent in the last year alone.
One example he gave took inspiration from Singapore, where a one-time tax of 15 per cent was applicable to those who sold their property within six months of first buying it.
"There are instruments that can be done," he told zawya.com. "Going forward, just make sure that fundamentals continue to drive it, do not let yourself be overtaken by a degree of exuberance."