Price Differentials in Real Estate in Dubai

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Real estate in Dubai is a very extensive topic and it is a very large market indeed. This essay will explain the concept of market forces and show how it can be displayed on the market of Dubai, thereby providing a response to the research question, “To what extent do market forces determine the price of rented accommodation in Dubai?” One can identify large price differences between two similar houses, whilst keeping square feet and housing type relatively constant. Yet, the key factor that causes these price differentials is the concept of demand and supply, for reasons such as location. This report will analyze 3 specific cases including studio apartments, 2-3 bedroom apartments and 3-4 bedroom villas and generalize the factors that cause these price differentials. After recording this data, this report will conclude to the extent to which demand and supply comes into concept, thereby answering the research question in an analytical procedure. This report will analyze properties in various areas of Dubai and follow the assessment task directly.

The rental market in any place in the world is a unique business. To a certain extent, demand and supply have a large say in determining prices just like any product in the world. If there exists an oversupply of homes in a given area, rental prices will fall indefinitely. However, there are some limitations to the law of demand and supply in the rental market. Unlike manufactured commodities in which you can allocate your resources differently, you cannot move the excess amount of homes out of that area to keep prices stable. This is one of the unique features of demand and supply in the rental market. On the other hand, if there is...

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