February 2016 ValuStrat Price Index (VPI) for Dubai residential real estate gave clear signs of the market’s return to its previous growth rates in house prices.
ValuStrat takes the absolute value of 100 points set in January 2014 for the 26 Dubai residential communities monitored by the agency as a basis for its property price index. And in February this year the index was set at 98 points, which is a little bit higher than in the few previous months, when VPI remained the same.
Apartment sales segment has shown the best results, especially for today's most popular areas like International City, Sports City and Jumeirah Lakes. Overall VPI index for Dubai apartments in February increased by 0.1% compared with the four previous months. This figure seems quite inconsiderable, but taking to account its general character and the fragmented demand and Dubai growth rates by areas, even this statistical increase can be considered important.
In the villas segment things aren't going as fast. VPI index for villas fell by 0.1%, but not for areas as Arabian Ranches, Dubai Hills, Palm Jumeirah and Al Wasl, where, for various reasons, villa prices are still quite stable.
According to the ValuStrat research manager Haider Tuaima, a decline in Dubai property prices started slowing down in the mid-2015 and last months of last year showed that a quite negligible decline in prices was clearly indicating the stabilization in Dubai real estate sector, which became obvious in the two first months of 2016.
ValuStrat report said that it seems the signs are indicating that we’ve reached a predictable stage of the market, when the market's bottoming out has begun. If all other economic factors are the same, it will stay this way for the next three to six months.