Dubai House Prices Surge for First Time in One Year
Issac JohnDUBAI — House prices in Dubai, which have been spiraling downward since last November, rose by 7 per cent in the third quarter from the previous quarter thanks to an increased availability of mortgages and a perceived increase in job security among expatriate workers, real estate consultancy Colliers International said on Tuesday.
The volume of transactions in residential properties grew by 64 per cent between July and September 2009 compared to the second quarter, according to the consultancy’s Dubai House Price Index. The Index, compiled using mortgage transaction data from financial institutions, also demonstrates a 47 per cent decline from the third quarter of 2008 to the third quarter of this year.
The report shows that at the end of this year’s third quarter, property prices in Dubai had returned to approximately the same level as those recorded in the second quarter of 2007. “The Q3 results indicate a ‘bounce’ in the market, but we will have to wait for the Q4 results before we can say whether an underlying growth profile exists, indicating a potential recovery,” said regional director Ian Albert. While apartment prices increased by 6 per cent over the last two quarters, villa prices increased by nine per cent in the third quarter from the second. Townhouse prices increased by 7 per cent over the same two quarters.
Colliers predicted that the volume of new units expected in the market in 2010 would suppress prices. But Colliers stressed that price suppression would be uneven. Certain upscale developments would offer investors “oases of performance,” it said.