Has the fall in Dubai property prices come to an end?
Dubai’s residential property market is showing signs it has stabilised after about 18 months of price decline.
Figures just in from the consultancy, ValuStrat, show that there was “no significant change” in values of apartments and villas in the 26 areas that it observed during December. It said that its ValuStrat Price Index remained constant at 97.9, making it the first time that no monthly change has been recorded since the current market correction began in mid-2014. The Index compares prices from a 100-point base that was set in January 2014.
Haider Tuaima, ValuStrat Research Manager, said that the rate of decline in its house price index had started to slow at the beginning of 2015, and for the past few months the change in values registered had been insignificant, signalling “a plateau in prices”.
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.”
Chief Executive, Ahmet Kayhan, of the real estate data specialist, ReidIn, said that its figures also showed that price declines were coming to an end. Its latest data shows a 2% fall in prices during the three months up to December, but Mr Kayhan told The National that apartment prices started to turn in October 2015, recording their first growth in 13 months. However, villa prices continued to fall for another couple of months, but they also plateaued in December.
Mr Kayhan said, “The main reason around that is the rental yield which has 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.”
Meanwhile, Dubai Land Department (DLD) said that the value of real estate transactions registered in the city increased by 8% in 2015 to AED267 billion.
Dubai’s residential property market is showing signs it has stabilised after about 18 months of price decline.
Figures just in from the consultancy, ValuStrat, show that there was “no significant change” in values of apartments and villas in the 26 areas that it observed during December. It said that its ValuStrat Price Index remained constant at 97.9, making it the first time that no monthly change has been recorded since the current market correction began in mid-2014. The Index compares prices from a 100-point base that was set in January 2014.
Haider Tuaima, ValuStrat Research Manager, said that the rate of decline in its house price index had started to slow at the beginning of 2015, and for the past few months the change in values registered had been insignificant, signalling “a plateau in prices”.
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.”
Chief Executive, Ahmet Kayhan, of the real estate data specialist, ReidIn, said that its figures also showed that price declines were coming to an end. Its latest data shows a 2% fall in prices during the three months up to December, but Mr Kayhan told The National that apartment prices started to turn in October 2015, recording their first growth in 13 months. However, villa prices continued to fall for another couple of months, but they also plateaued in December.
Mr Kayhan said, “The main reason around that is the rental yield which has 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.”
Meanwhile, Dubai Land Department (DLD) said that the value of real estate transactions registered in the city increased by 8% in 2015 to AED267 billion.