A top Middle East official for the International Monetary Fund (IMF) has warned that Dubai may be in danger of another property price crisis unless it imposes measures to regulate development.

‘It’s important from looking at the stock of real estate that is coming on to the market to be careful to ensure measures are in place to moderate the pace of growth to avoid any risk of the boom and bust cycle’, Masood Ahmed, the head of the IMF’s Middle East and Central Asia department, told local press.

After dropping by more than 50% post-2008, Dubai house prices have been rising again lately, with new villa projects drawing long lines of buyers. In some areas prices are up as much as 20% compared to a year ago. But some analysts have expressed concerns that the recovery is only isolated to certain neighbourhoods in Dubai, and only for luxury developments.

The increased activity has also been linked primarily to investors, rather than end-users. At the same time, Dubai has been proposing several new large scale projects, reminiscent of the pre-bust days. One recently announced project, Mohammed bin Rashid City, calls for the 1,500 villas, the world’s biggest shopping mall and more than 100 new hotels, the arrival of which would no doubt have a negative impact on investors looking to rent their villas and apartments to short-term visitors.