Dubai’s property market has enjoyed a rollercoaster couple of years, after the market rebounded from collapse to post some of the fastest growing property prices in the world. Since then, though, real estate values in the emirate have declined once more, as the market cools down, driven by government measures designed to dampen speculative investment.Property values slipped by almost 0.3 per cent in Q3 2014, followed by a further 0.5 per cent drop in the final three months of last year. As a result, prices rose just 3.4 per cent in 2014, down from 51 per cent in the previous year.Property advisors at Harbor Real Estate, though, argue that the correction is "overdue".The total value of real estate transactions reached Dh234 billion in 2013, a 52 per cent increase on 2012, something that Harbor highlights as "clearly unsustainable"."Just over Dh63 billion worth of transactions has taken place this year, indicating that the market is well and truly entered its correctional phase," comments the firm.A slew of new projects being launched as a result of renewed developer optimism have also helped to hinder prices, amid concerns about potential over-supply."Calculating optimal supply levels, especially when emerging from a recessionary period, is particularly challenging," admits Harbor. "It depends on an accurate estimation of demand for real estate assets that will emanate from Dubai’s population growth, which will be largely driven by overall economic growth."There will be about 11,000 villas, 7,500 town houses and 35,000 apartments delivered between now and 2020. But Harbor argues that, in the long term, this is not necessarily too much."We at Harbor take a minimum five year view when looking at equilibrium or imbalances in the market," continues the firm. "When taking into account the nature of its resurgence, the strong growth in fundamental economic drivers such as tourism and trade, the levels of investment into infrastructure and initiatives and stakeholder commitment to sustainable growth, we believe that while inventory levels may spike in the interim, they will not be excessive at the end of our five year forecast period."Harbor concludes: "The correction could not have come at a better time."

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