Hamptons report says Downtown Dubai and Palm Jumeirah see biggest increases
Dubai's real estate sector recorded price increases of up to 30 percent in prime locations during 2012, according to Hamptons MENA.
The Hamptons MENA 2012 property report said that on average property prices increased by 20 percent across the market, while well-established neighbourhoods such as Downtown Dubai and The Palm Jumeirah witnessed an upward trend in price of up to 30 percent.
The most significant price increase was noted for villas, such as in Arabian Ranches, the masterplanned community by Emaar Properties, which led the growth in values during the year.
Hamptons said high-end apartments in Downtown Dubai and Emirates Living also reported strong price appreciation.
Niraj Masand, head of operations of Hamptons MENA, said: "The strong performance of the residential property market in 2012 is a reflection on Dubai's sound economic fundamentals.
"Led by the robust performance of its traditional growth sectors including retail, tourism, aviation, hospitality and trade, Dubai has established its position as the region's business and tourism hub.
"This had a positive impact on the property sector too, with the established communities in Dubai witnessing price increases of up to 30 percent."
He added that with several new mega projects being launched including Mohammed Bin Rashid City, Dubai's property sector was "poised for stronger growth in 2013".
Hamptons said it has seen strong customer interest both in buying and leasing activity in the established neighbourhoods in Dubai during 2012.
It said the value of transactions facilitated by Hamptons MENA during 2012 rose by over 16 percent compared to 2011.
The most significant demand came from Downtown Dubai and Dubai Marina with more than 7,500 sales and leasing enquiries in 2012.
Hamptons said the average size of properties bought was 1,320 sq ft compared with 1,722 sq ft in 2011, indicating more small-size families showing their interest in property investment.
Hamptons added that it expects that demand for apartments in Downtown Dubai and Dubai Marina to increase in the coming months, based on this trend.
"Although, the overall market is still seller-oriented, the positive growth of the economy is expected to further boost demand, especially with individuals looking to move into bigger properties by cashing in on the current market sentiment," the report said.
Earlier this week, Emirates Banks Association (EBA) chairman Abdul Aziz Al Ghurair said UAE property values have returned to their pre-crisis levels and in many cases have climbed higher.
Real estate prices started to rebound last year after Dubai suffered one of the world’s worst property market crashes following the 2008-09 credit crisis.