Search by map
Dubai real estate market seems to have started to level off after 18 months of decline, experts predict.
In its latest report ValuStrat consultancy noted that prices for apartments and villas in 26 monitored Dubai districts have not changed in December last year. ValuStrat takes the absolute value of 100 points set in January 2014 as a basis for its property price index. And in December last year the index remained constant at 97.9 points, the same as the previous month.
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.
Tuaima said: “Some might suggest that this is a bottoming out of the market and the only next step is for values to go up,” he said. “We’re not saying that at the moment, but it seems the signs are indicating that we’ve reached a predictable stage of the market. If all other economic factors are the same, we are assuming it will stay this way for the next three to six months.”
Ahmet Kayhan, chief executive of the Reidin consultancy also suggested that a period of decline in Dubai house prices in coming to an end. According to the company’s data for the last three months of the year, property prices in Dubai have fallen by an average of 2% and some segments of the market already show a noticeable growth for the first time in thirteen months.
Kayhan assumes that “The main reason around that is the rental yield. Yields have come to a level which is making the market really, really attractive for investors”. “When you look at the yield numbers right now, you’re looking at 7.5 to 8 per cent for the general apartment market. And you’ve got 9 to 10 per cent for smaller units and more affordable property in places like Discovery Gardens, International City and B-type units in JLT,” he added.
DLD has also confirmed the period of stabilization have started, marked with the increased number of real estate transactions registered last year worth in total USD 72,69 billion.
