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DUBAI REAL ESTATE MARKET UPDATE

DUBAI REAL ESTATE MARKET UPDATE

Haitham Sadek 0 Comments

In Dec 2017, Propertyfinder.ae issued the third edition of “Trends” magazine. This edition included extremely useful information for everyone interested in UAE Dubai Real Estate market including many of Wealth Heights’s members. Therefore, I thought of summarizing the key highlights focusing on Dubai. As always, please send any question to info@wealthheights.com

  • Prices have continued to fall for the last 6 months and have been falling consistently for almost 3.5 years. Prices now are at 2013 level. Main reasons are a significant volume of new development, sluggish oil sector and slow population growth offset partially by good and improving business sentiment. Small and medium business are investing and hiring more staff particularly in the tech, construction and tourism sectors
  • Dubai yield is at 6.7% which is one of the highest among international cities like Tokyo (2.7%), London (3.4%) and Sydney (4%),
  • Apartments rent update:
    • Apartments rents in Dubai have fallen in the past 6 months with most of the communities declining by a low single digit and only very few communities with a modest rent increase.
    • Communities with highest rent demand are Marina, JLT, Downtown and Business Bay with a yield of 6.3%, 7.5%, 5.5% and 5.9% respectively which represent a decline of 0.2%, 0.4%, 0.2% and 0.3% respectively in the last 6 months
  • Apartments sales update:
    • Apartments sale prices have been falling with low single-digit declines across most communities in Dubai.
    • Communities with highest sale demand are Marina, JVC, Downtown and JLT with a price per SQF of 1570, 925, 2132 and 1212 AED respectively. In the last 6 months, prices slightly increased by 0.5% in Downtown, flat in JLT while declining in Marina and JVC by 2.4%and 2.2% respectively.
  • Villas rent update:
    • It’s a good time to rent a villa in Dubai as rent in most popular villas communities saw a double-digit decline in the last 6 months.
    • Communities with highest rent demand are the springs and Arabian Ranches with a yield of 6% and 5.2% respectively which is flat in the last 6 months.
  • Villas sales update:
    • Dubai villa prices also experienced significant declines with Meadows (-9.3%), one of Dubai’s best and most sought-after communities experienced the biggest decline over the past 6 months while sale prices in JVC (+4%) and Al Barsha (+0.6%) were the only two communities that witnessed an increase.
    • Communities with highest villa sales demand are Arabian Ranches and The Springs with a price per SQF of 1121 and 1029 AED respectively which represents a decline of 4.5% and 6% respectively in the past 6 months.
  • “2018 market forecast- Top 10 reasons for prices to go up” – Written by Kalpesh Sampat, Managing partner, Gulf Sotheby’s:
    1. Dubai has an amazing security and safety in the middle of increasing geopolitical and security concerns globally
    2. According to real estate data portal ReidIn , population growth is outpacing properties supply by two to on in 2017
    3. Expo 2020 will attract more investors to the market
    4. Dubai is a cosmopolitan city with people from 200 nations
    5. Investment are highly stable in a secure escrow account
    6. Dubai has one of the highest yields in the world
    7. Projects and developments are built in a record time. Dubai canal built in two years and Metro in three
    8. Business friendly city with limited restrictions
    9. There are no taxes on capital gains or rent
    10. Anyone who buys a property worth at least 1million AED (275k USD) is eligible for residency visa along with immediate family members which is renewable unconditionally every 6 months, and if exceeding 2 million AED, then for 2 years.

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