A three-year downturn in Dubai's property market will likely continue until at least 2020, Standard & Poor's said Tuesday, citing low oil prices, the introduction of VAT and a Gulf diplomatic crisis.

A glut of housing units and weak demand were also key reasons for the decline, the credit ratings agency said in a report.

The emirate's real estate sector has been on the slide since 2014, when crude oil prices crashed, dealing a harsh blow to many Gulf investors.

Home prices dropped more than 15 percent between then and mid-2017.The downward trajectory continued through to the end of last year, the S&P report said, with prices of residential units falling a further five to ten percent.

It said the introduction of a value added tax and a prolonged crisis between Qatar and its Gulf neighbours, including the United Arab Emirates, had also put pressure on real estate prices.

S&P called the downturn a "correction" but said the sector may start to bounce back when Dubai hosts a six-month World's Fair in 2020.

"We believe this correction will continue at least for this year and next, before prices stabilise in 2020 at the earliest," it said, adding that rents will likely follow the same trend.

Dubai's Expo 2020 is expected to attract up to 300,000 visitors a day when it opens in October 2020.

Experts have predicted it will also create around 300,000 new jobs and attract new residents in the emirate city, which currently has a population of three million.

Dubai is slated to spend some $7 billion (5.7 billion euros) on infrastructure projects and $2.9 billion on the expansion of the metro route to the exhibition between now and event's inauguration.

The property sector and related activities form around 13 percent of Dubai's gross domestic product, which was $108 billion at the end of 2017.

Between December 2015 and June 2017, overseas investors put up as much as $41 billion to purchase property in the emirate, said the Dubai Land Department in August.