CBRE consultancy presented its own vision of changes that took place at the Dubai real estate market in 2015. According to the report, property prices in the emirate fell by an average of 4% in the fourth quarter and the overall year-on-year decline in apartment prices reached 16%, while villa prices fell by 14% in a year.
Dubai property buyers were also much less active in 2015 than in 2014, so the total volume of real estate transactions decreased by 33% in a year, according to CBRE.
Meanwhile, CBRE analysts predict a further decline in the market sales price indices due to upturn in the developers’ activity, especially in the segment of affordable housing. According to a forecast by CBRE, Dubai will see 48,000 new housing units handed over between 2016 and 2018.
And the rental market in the meantime turned out to be more resistant to prices pressure, the report said. In general, all segments of the rental market in recent months showed a tendency to plateau in price indices, and only its extremes showed opposite results.
“With the actual delivery of units falling short of anticipated supply levels, the occupier market has held up comparatively well, particularly for more affordable locations such as Jumeirah Village Circle, Dubai Sports City and Dubailand Residences which all achieved rental growth,” Mat Green, Head of Research & Consultancy UAE, CBRE Middle East said.
At the same time central Dubai locations with premium properties saw a decline in rents. “As has been the trend, prime areas such as the Palm Jumeirah, Dubai Marina and Downtown Dubai continued to see rental deflation with rates falling between 1 and 3 per cent during the quarter,” Green noted.
Commercial rental market, on the contrary, showed all signs of upsurge in demand as well as in prices.
“The sector has remained steady despite the emergence of more challenging economic conditions in the region amidst a period of lower oil pricing,” the report said.
Moreover, the demand for high-quality large Class A offices in such Dubai areas as Dubai Media City, D3, Trade Centre and JLT keeps growing at the background of a pick-up in pre-leasing activity during 2015.