KHALEEJ TIMES, Thursday, Jul 12, 2018 | Shawwal 28, 1439
Dubai home prices down 20% since market peak in 2014
properties have seen their capital values decline by 20 per cent since the
market peak of mid-2014, says consulting firm ValuStrat.
However, the steep declines have boosted sales as transaction volumes and
average ticket sizes have increased across the board.
Quarterly declines of more than five per cent were registered in locations such
as The Springs and Meadows, Jumeirah Islands, International City, Downtown
Dubai, Business Bay, Motor City, The Greens and The Views, according to
ValuStrat. However, villas on the Palm Jumeirah and Emirates Hills continued to
resist downward pressures, with only marginal dips.
Dubai properties displayed a 6.7 per cent annual decline in capital values in
Q2, and the sharpest quarterly drop of 3.8 per cent, a four-year record.
Off-plan sales volumes are up 10.9 per cent year on year (YoY) and 18.7 per cent
quarter on quarter (QoQ). The numbers of secondary properties sold also rallied,
up 1.5 per cent YoY and 10.2 per cent QoQ.
Established areas that witnessed substantial off-plan sales transactions during
the last three months included Business Bay at 86 per cent of all sales being
off-plan, Downtown Dubai at 70 per cent and Jumeirah Village 65 per cent,
Average ticket prices have also risen, off-plan saw a 5.6 per cent QoQ increase
to Dh1.4 million, whereas ready property ticket sizes jumped 23.9 per cent QoQ
to reach Dh1.9 million.
"Recently announced government incentives towards investors and record low
prices seemed to have encouraged the quarterly double-digit growth of
residential homes and office space transactions. This is despite the fact that
Ramadan fell in the second quarter this year, typically not a very busy time for
real estate deals," said Haider Tuaima, head of real estate research at
An estimated 8,718 apartments and villas, equivalent to 23 per cent of the total
expected supply for 2018, have been completed year to date. About 64 per cent of
these completions were located mainly in three areas: Dubailand, Jumeirah
Village Circle and Dubai Silicon Oasis.
Overall residential asking rents fell 8.4 per cent YoY. However, on a quarterly
basis, asking rents declined moderately by 1.7 per cent. Compared to the same
period last year, listed rents were down 8.6 per cent for apartments and 7.5 per
cent for villas.
Declan King, managing director and group head real estate, said: "Second quarter
increases in transaction volume and ticket sizes for residential properties is
noteworthy. However, it is far too early to say whether this is a one off
statistical event or an emerging trend of improved buyer sentiment and market
demand - on the back of significant price reductions."