The residential market in Dubai is heading towards a soft landing following a period of restraint in the wake of oil price volatility and negative investor sentiment, said a report by global property expert Knight Frank.

With sale prices becoming more realistic and developers adopting a more mature approach to their project launches - phasing projects out and releasing them in line with demand - confidence is expected to return to the market, stated Knight Frank Middle East in its first edition of Inside View Dubai, featuring current research on the Dubai market and lifestyle editorial.

The report discusses the outlook for the emirate in general and real estate sector in particular, and stresses its dependence on a number of regional and global variables.

Dana Salbak, the associate partner and head of research at Knight Frank Middle East, said: "While we have seen a slowdown in demand for residential property in Dubai over the past 18 months, the appetite remains healthy and is expected to rebound over the next couple of years as investors regain their confidence."

"The real estate market is more mature, and this resilience will drive the next growth cycle," remarked Salbak.

In this regard, she said Dubai’s position as a leading financial hub and competitive tourist destination leaves it exposed and vulnerable to global events.

"Further volatility in oil prices, elections in the US and across states in the Eurozone, and ongoing geopolitical tensions are likely to impact the behaviour of markets, currencies and investor sentiment. This in turn will reflect on the demand for property in Dubai," explained Salbak.

Knight Frank said while it’s difficult to predict when the next growth cycle will be, it expects the residential market to level out by the end of 2016 before seeing gradual recovery in 2017.

This is further supported by the ongoing government spending on key projects geared towards the Expo 2020, it added.-TradeArabia News Service