While the Dubai real estate market is experiencing a bull market unmatched anywhere in the world, Americans should think twice before investing in the area. Remember, if it is too good to be true, it probably is.

This frantic upswing in real estate prices has been urged on by speculation despite a devastating loss in real estate value just five years ago. In 2009, Dubai real estate holdings lost over 90 percent of their value, according to the Wall Street Journal’s estimate. Now, market value has surpassed 2009 highs and shows no signs of stopping.

The Dubai real estate market has posted increases of up to 30 percent annually in each of the years since the current bull market began in 2009. In an age where U.S. investors are wary of rising interest rates and an overvalued stock market, Dubai’s real estate market may appear to be a promising hedge against domestic uncertainty.

Not so fast, my friend.

While surface-level returns are promising, underlying issues could indicate another crash is right around the corner. Most prominent among these issues is the governing structure established in Dubai. Instead of a Western-style democracy, Dubai is run by an autocratic leader, Sheikh Mohammed bin Rashid al Maktoum. Modern Dubai’s boom is attributable to the sheikh’s vision, but the leader has done little to ensure property rights for non-citizens. Al Maktoum has liberalized the regulatory environment over the last decade, as non-citizens may now have 99-year land leases to build upon, but the government still owns all land. This adds uncertainty to the market. For the Dubai real estate boom to be sustained into the future, the government must eliminate the uncertainty surrounding property rights by allowing ownership. Such a move looks unlikely in the future.

Additionally, demand is so high that it has moved investment from legitimate to speculative. In a recent anecdote detailing demand levels, real estate company Emaar Properties had to call police to control a riotous crowd clamoring to purchase condos in a recent development. These buyers were not conducting rational fundamental analysis of the specific holdings, but were jumping at the newest opportunity to speculate without examining the asset’s underlying financial health. In highly speculative markets like the modern Dubai real estate market, bust is always lurking around the corner.

Finally, the recent surge of Chinese investment in Dubai real estate is an indicator of increased speculation into the future. Due to the princeling structure in China, there is currently uproar over the growing disparity in China’s wealth; much of this disparity is due to state cronyism. In response, wealthy investors that have benefited from corruption are looking to escape backlash from the Chinese polity by storing wealth abroad. The involvement of Chinese investors storing capital abroad has led to artificially high commercial real estate prices in the markets where these individuals invest. This is because Chinese investors care more about getting cash off their books in China and less about negotiating prices to find value elsewhere. It is only a matter of time before the influx of Chinese funds leads the Dubai real estate bubble to climb even higher.

Dubai may be a beacon for foreign capital because of its high real estate returns, but it is important American investors stay away from this market. Property rights concerns, speculation, and the presence of Chinese investors make investing in Dubai a risky proposition. Buyers beware.