Dubai - Beware

The latest articles about investing in real estate on the Unique Property site are warnings. Everyone is getting excited about Dubai.>

I have read quite a lot about the prospects for Dubai. A lot of money has been made over the past couple of years. I expect a lot more will be made over the next couple of years as well. But what about beyond that?

I am very pessimistic about the situation in the middle east. Iraq is one of the three most unstable countries in the world. Have a look how far it is from Dubai.

The other two most unstable countries are Iran, and Saudi Arabia. Both are holding down an incredible undercurrent of turbulence, and most of that turbulence is allied to a dislike of the West, especially Brits and Americans.

Have another look at that atlas. You will find that the UAE has a rather long border with Saudi Arabia, and facing it just across the narrow straits is Iran.

Never mind armed invasion. Think about something far more devastating. Saudi Arabia probably wont want to invide its neighbour, neither will Iran, but how about them leaning on the country to make it an alcohol-free zone in line with sharia law. What would that do to your tourist apartment investment?

Dubai is ringed by countries that could well be seriously hostile to Brits and Americans within the next five years. If you put money there, make sure you can afford to lose it, or aim to get it out again within two years. It all looks nice on paper, but Montenegro is safer.

Have a look at our articles. But I'll hit you with another of these short bulletins next week.