For a key to the recovery of Dubai's real estate market, one need look no further than the Burj Khalifa, the world's tallest tower, which rises out of the desert floor of the city's gleaming downtown area.
Figures released by the Dubai government this week showed Indian citizens were the main buyers of luxury apartments and commercial space in the Burj Khalifa during the first half of 2012, spending $222 million. Iranians came second with $128 million.
For the Indian buyers, Dubai property is a refuge from currency depreciation that has taken the Indian rupee down about 20 percent against the US dollar since the third quarter of 2011. For the Iranians, Dubai provides a safe place to park money as international sanctions ravage the Iranian economy.
Four years after a property price bubble burst in Dubai, triggering a slide that cut home prices more than 60 percent from their peak, the market finally appears to have stabilized and is recovering in some areas. A major reason is an influx of foreign money using the emirate as a safe haven.
"A lot of people in the Middle East and Russia, Pakistan, the Asian sub-continent are looking for a safe haven," said Farouk Soussa, Middle East economist at Citigroup in Dubai.
"Perceptions are that the real estate market has bottomed out. If you are looking for more long-term investment, the market in Dubai seems reasonable."
Because of the importance of real estate in Dubai's economy — it contributed about 13 percent of gross domestic product last year, almost as much as manufacturing — a healthier property market is likely to have a string of positive effects. Among other things, it may reduce the pressure on indebted state-linked companies that are restructuring their loans.
The recovery is not being felt throughout the market; in less popular areas, especially less affluent districts in northern Dubai, prices have stayed weak, analysts say.
But positive signs have mounted in the first half of this year. Real estate agent Knight Frank's quarterly prime global cities index showed apartment prices in Dubai rallied over 5 percent in the second quarter compared with six months ago.
Average apartment rents in Dubai are estimated to have increased 2 percent in the second quarter, according to a report by property consultants CBRE. Particularly well-situated communities such as Emirates Living and Downtown Dubai may have seen rises of 5 to 8 percent quarter-on-quarter, it said.
The real estate recovery has supported a rebound in Dubai's stock market. Shares in its biggest property developer, Emaar Properties, hit a 15-month high last week and are up 32 percent this year — though much of the company's rising earnings are due to its successful diversification away from residential real estate into hotels and retail.
"We see Dubai real estate performing well over the medium term," said Graham Stock, strategist at frontier fund manager Insparo in London, adding that Dubai to some extent resembled London in the way that safe-haven buying by foreign investors was aiding property prices.
In London, prices have been boosted by investors from countries such as Russia and China because of Britain's political stability and strong legal system, while the sector has also attracted buyers from crisis-hit Greece.
Dubai lures buyers from the Indian subcontinent and Iran because of geographical proximity, easy access through its well-developed web of international links, and large Indian, Pakistani and Iranian communities. Meanwhile, the United Arab Emirates' political stability has attracted Arab money to Dubai.
Money from Afghanistan, created by international aid there, is believed to be flowing to Dubai as nervous businessmen prepare for the withdrawal of most foreign troops from that country by the end of 2014.
Foreign investors bought real estate assets in Dubai worth 28.3 billion dirhams ($7.7 billion) in the first half of 2012, up 36 percent over last year, Dubai government figures show.
Nobody is expecting the market to come close to resuming the wild boom seen before 2008; prices will take many years, perhaps decades to regain their peak levels.
"Dubai's property market will improve, but gently. Not at the 40 percent growth per quarter that we saw during the boom," said Loic Pelichet, Dubai-based assistant vice president for research at NBK Capital.
"The boom of 2008 is very unlikely ever to happen again. That was just massive speculation. There is recovery in certain places, but there's still a lot of inventory coming into Dubai."
Twenty-four thousand new residential units are scheduled to be delivered in Dubai during the second half of 2012, and a total of 41,000 units by the end of 2014, consultants Jones Lang LaSalle said. The existing number of residential units is estimated to be about 344,000.
Pelichet also said it was unclear whether property prices would continue rising when safe-haven demand related to the Arab Spring eventually dried up.
But there are reasons to think the market may continue recovering for some years at least. One is the fact that by the standards of the top international cities, Dubai is still fairly cheap in the wake of its market crash.
Apartments in the 828-meter Burj Khalifa range from about $710 to $1,035 per square foot, according to real estate brokers. This is much cheaper than average prices in prime areas of London, which can hit $3,000 or more per square foot.
Secondly, Dubai may attract new flows of safe-haven money even if its existing ones start to dry up. The UAE dirham's peg to the US dollar will help to make Dubai attractive if, for example, a partial collapse of the euro zone sends funds fleeing from European currencies.
The exposure to the dollar's exchange rate could turn sour if the United States is caught in a debt crisis. But in that case, the comfortable budget positions of Gulf economies — the UAE is expected to post fiscal surpluses of over 5 percent of gross domestic product this year and next, according to a Reuters poll of analysts - mean that more than almost anywhere else, the Gulf will be able to spend its way out of trouble. That could attract investors from around the world to Dubai.