The new report by MPM Properties analytical department of the Abu Dhabi Islamic Bank (Adib) showed that Dubai residential property stock is growing rapidly. 6,500 new housing units in residential sector were handed over in the year’s second quarter.
Most of the new properties, according to the report, is located along Dubai’s main transport ‘corridor’ Sheikh Mohammed Bin Zayed Road, which together with the real estate brought to the market in the International Media Production Zone increases the amount of Dubai residential property stock by 26%. Thus, the total number of units in the housing sector of Dubai at the moment has reached 479,000.
In total, about 8,500 new residential units were constructed and handed over in the first half of 2015 in Dubai, and the second half of the year is expected to further increase the stock by 11,500 new completed units.
Ready housing increased supply means that in the near future prices in the sales segment, as well as in the rental segment of Dubai real estate market will continue to fall, experts say. According to MPM Properties, sales prices in Dubai declined by 3.5% in the second quarter and prices in rental sector fell by 3% during the same period.
“The volume of new projects in the Dubai market means that properties will increasingly need to appeal to potential buyers’ sense of value,” said Paul Maisfield, chief executive of MPM Properties. “That means a shift towards well managed, self-contained and mid-market properties, particularly close to the Expo 2020 site. We are also seeing a greater emphasis on buyer incentives and unique selling points, especially in the luxury segment and expect buyers to benefit from these trends.”
At the same time, the "pressure" on the infrastructure, particularly on the transport system, in remote areas of Dubai, such as Al Nahda, Muhaisanah and Al Qusais Industrial Areas 3 and 4 may soon start to rise, experts warn.