By Staff writer
New report says February saw 'minute indications' of an early recovery in some areas of the emirate.
Property prices in Dubai may have bottomed out, with values rising slightly in February, according to a new report.
Real estate consultants ValuStrat said there were "minute indications" last month of an early recovery in some areas of the emirate.
The February ValuStrat Price Index (VPI) for Dubai's residential market signalled possible signs of a bottoming-out in monthly values across the 26 areas it monitors for apartments and villas.
Compared to a 100 point base in Jan 2014, the February 2016 VPI registered 98.0 index points, with no significant change in values when compared to the previous five months.
"This marks a continuation of evidence of price stabilisation," ValuStrat said in the report.
The report said the villa market registered 96.8 points in February, down 0.1 percent when compared to January, and the apartment market 98.7 points, up 0.1 percent when compared to the previous four months.
ValuStrat's VPI also revealed that price to rent ratios were 20 years for villas and 14 years for apartments while gross yields were 5.5 percent for villas and 7.5 percent for apartments.
The report added that net yields were 4.4 percent for villas and unchanged for apartments at 5.3 percent.
Dubai developers are pressing ahead with their construction plans despite expectations that property prices will fall yet further this year, undaunted by memories of a 2008 crash.
Industry consultants say that while sales volumes have slumped in the emirate, structural changes to the market such as tighter regulations together with fewer speculators and developers should ensure a much softer landing this time.
But others worry about ripple effects from the dive in oil prices, even though Dubai is a small crude producer compared with fellow emirate Abu Dhabi, and wonder how all the projects that are being announced will be funded.
Dubai property prices have been more volatile in the past decade than in other centres.
Residential prices in the emirate fell 50 percent from a third-quarter 2008 peak to mid-2009, suffering a second downturn in early 2010, industry consultants Cluttons estimate.
Prices then rebounded from 2011 following an influx of money and people displaced by uprisings in several Arab countries, recovering to within 18 percent of 2008 peaks.