Dubai homes 22% cheaper than market peak in 2014
Dubai - The decline has slowed to 2.9 per cent since the previous quarter.
Property values in Dubai are 22.3 per cent cheaper since the peak of mid-2014, according to a third quarter report issued by local consulting firm ValuStrat.
Although residential capital values dipped by nine per cent in third quarter of 2018, the decline has slowed to 2.9 per cent since the previous quarter.
"Our research has shown that this quarter saw increased investor focus on ready-to-move-in apartments and villas priced between Dh3 million and Dh5 million, causing the average ticket size to jump," said Haider Tuaima, head of real estate research at ValuStrat.
All established freehold locations witnessed price drops since the last quarter, ranging from 0.2 per cent to five per cent, said ValuStrat.
Quarterly declines of more than four per cent were registered in Jumeirah Islands, Business Bay, Palm Jumeirah (apartments) and Discovery Gardens. Capital values for villas in Palm Jumeirah and Al Furjan remained mostly flat as compared to Q2.
Established areas that witnessed substantial off-plan sale transactions during the last three months included Downtown Dubai at 85 per cent of sales being off-plan, Business Bay at 84 per cent and Remraam 75 per cent. Average ticket prices for off-plan homes fell 3.8 per cent QoQ, whereas ready property ticket sizes jumped 9.5 per cent QoQ, suggesting improved interest in prime properties.
According to ValuStrat, an estimated 12,332 apartments and villas, 27 per cent of the total supply as expected at the start of 2018, have been completed year to date. Seventy per cent of these completions, amounting to 8,614 units, were located mainly in five areas: Dubailand, Jumeirah Village Circle, Dubai Silicon Oasis, International City phase 2/3 as well as Dubai Marina.
Residential asking rents fell 11 per cent year on year, however, on a quarterly basis, asking rents declined 5.1 per cent. Compared to the same period last year, listed rents were down 11.1 per cent for apartments and 10.2 per cent for villas.
Declan King, managing director and group head real estate, ValuStrat, said: "While the third quarter is normally a quieter time in the Dubai real estate sector, with many people away during the summer holiday months, it will be interesting to see if early signs of a slow-down in price declines continue into Q4. Also, bearing in mind the impact off-plan launches have had on the city's wider property market over the last year, we would hope that the forthcoming Cityscape Global will see a more measured approach to new home launches in Dubai."