Dubai property prices fell by just 4 percent in the last six months but future supply could prevent a near-term recovery, Deutsche Bank said on Wednesday.
Property prices and rents were flat on the month, indicating that the market is stabilizing, but prices are still down by 52 percent from their peak, the bank said.
“While signs of life are multiplying in the real estate market, we believe the main risk remains new supply, which could prevent any meaningful recovery in the near term,” analysts Nabil Ahmed and Athmane Benzerroug wrote in a research note.
Around 30,000 new housing units could hit the Dubai market by the end of next year, they added.
Prices eased by 0.9 percent on the month while rents gained 2.4 percent in October, according to the Deutsche Bank proprietary price index.
Deutsche estimated that transaction levels have risen by 50 to 60 percent from their lows in the first half of the year.
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