Dubai Property Plateau Suggests End to Down Cycle
- Dubai residential real estate prices may have bottomed out after plateauing in May 2016, according to the property consultancy firm ValuStrat.The company said prices stabilised in April and May after almost 2 years of declines, citing its price index, which stood at 98.0 points last month from 100 points in January 2014.Prices, when compared to the last 8 months, showed no significant change in value but were down 1% over the same period last year, it said.
In the company’s index, the villa market stood at 96.7 points in May, unchanged from April and down just 0.2% since January, while the apartment market registered 98.8 points, unchanged from April but up 0.3% since January.
For the last 2 years, Dubai property sale prices and rents have been on the decline, slowing down real estate transactions. Analysts have attributed this trend to falling Crude Oil prices and the strengthening of the USD, leading to reluctance to invest in luxury properties.
However, the last few months have seen positive signs of recovery and increasing investor interest.
ValuStrat suggested that the “minor price uplifts” and notable increase in Dubai Land Department transaction volumes in several locations during May added to possible signs of bottoming-out in monthly value “across most of the 26 areas it monitors for apartments and villas”.
Online portal propertyfinder.ae also recently noted property buyer interest in the United Arab Emirates (UAE) had increased to its highest mark since Y 2014.
The company said last month that although real estate prices across the country had fallen 20 to 40% over the last 18-24 months, qualified buyers were now watching carefully to find the bottom of the market.
Amid signs of demand picking up, several off-plan residential projects have been launched in Dubai so far this year and are predicted to add more then 2,000 units to the pipeline by Y 2021.
These include Dubai Properties’ Bellevue Towers and Bella Casa -Serene, Damac’s Aykon City and Emaar’s Harbour Views (as pictured above).
By Natasha Malik
Paul Ebeling, Editor