By Soren Billing
Real estate consultancy also says that there are signs that rents are stabilising.
Dubai rents will keep falling in the third quarter of the year, with the oversupplied apartment sector experiencing the steepest decline, according to real estate consultancy Landmark Advisory’s latest report.
Landmark said in its June guide for sales and leasing in the emirate that it expects further decreases in Dubai rents for the third quarter but that there are signs that rents are stabilising.
For potential home buyers, the latest price map from Landmark Advisory indicate that ‘distressed sale’ opportunities are largely finished, as sellers refuse to lower existing prices.
In some cases, buyers are paying increased rates for sought-after residential developments with limited homes available, according to the transaction-based reference map.
“Smaller villa developments with a limited supply that have tapped into sufficient value recognition among end-users with regards to location, layout, build quality and amenities/facilities are among those residential developments experiencing price increases,” said Jesse Downs, director of research at Landmark Advisory.
“Examples in the sales market include Jumeirah Islands and Green Community.”
Landmark said apartments had experienced a steeper fall in rental and sales prices than villas, and that this would continue to be the case.
The combination of the economic downturn and the completion of a large number of high rise apartments last year have resulted in an oversupply in that segment, it noted.
When is an estate agency going to start sharing actual facts, instead of waffling and piffling and trying to sound like they know anything about the failed property market. If they simply said a flat at so and so cost this now, a villa this etc. it would help buyers, renters and investors gauge what is really happening. But it is clear the market is still in freefall, and claims distressed sales have dried up are nonsense, as there are cycles and a new wave will come shortly, as in Hong Kong and Singapore in the early 90s.
It's not very long since Landmark said that Rents were stabilising. now they will drop more. What's their agenda now?
Geriant / Thomas, You think landmark, bh or any other real estate agent is better than you and me, no, they also think and guess every now and then and with the support of Omar's and Shakir's, try to pump up the market, but in vain because they are trying to swim against the tide. Ignore them.
I have said before that 'distressed sellers are not as distressed as they used to be.' Now Landmark Research says, 'No more distressed sales.' For more than a month I have been looking for a genuine distressed seller. I found none, so I am likely to believe this report. Some people, of course, might not like this.
I don't think there's any surprise here. Nothing newsworthy. Dubai rents are still unrealistically high and that explains why so much of real estate is just catching dust. In reality, a two -bedroom in Dubai should not be any more than 30K in a good locality because that is what it is really worth when you consider construction quality and other indirect market forces such as individual earning capacity. It used to be that much not too long ago. And in those days, the roads used to be far more busier.
Hi All, Every Tom, Dick and Harry is talkin abt the economic downturn and collapse of real estate market. Not any more. Becuase the market is already dead. Obviously you can revive any market if it is down but not when it is dead. HERE THE REAL ESTATE MARKET IS DEAD - so there should n't be any talk of reviving / picking up in 2010 etc.,
I would like to agree with Geriant and Thomas. The landmark index seems to be not in line with reality. For example, for a office space in Tecom, the rates are indicated at AED 1,100 - 1,800 per sq. ft. I know for sure that my close friend is struggling to sell office space in this area at aed 675/ SQ. FT. The real estate agents, in their selfish interest, in my opinion, are trying to artificially paint a very rosy picture of the grim situation.
don't worry too much Shakir, landlords can not continue to live in denial for much longer! They can boast that they have millions in the bank to cover any short-falls but even the world's richest have lost billions and so time will tell. So, my advice is to wait it out a little longer and reap the rewards. Dubai will become another Spain, Singapore, Bulgaria albeit much worse because unlike it's counter-parts this country does not believe in transparency, equality and freedom of speech. Instead they promote distorted media reports to rebuttal any statements made about declining populations, increased redundancies, mass exodus of investors, empty properties/towers, crime rates, etc. The writing is on the wall, you can brush all your problems under the rug but sooner or later you will have a mountain of dust to overcome!
Man, i like your efforts, you are positively commenting about each and every report related to real estate, i like the way u trying to maintain your job as a real estate agent, However, you have to note, ppl are not naive as they used to be last year. Goodluck Dude
There can be no doubt that the bottom of the market is still a way off! No matter what is said and by whom - with or without any hidden agendas. Any reports from RE Agents should be treated with total and utter contempt - they are 'fish & chip' news only. Of course they willplay up the market, because reality bites an only the strong will survive... look around you, what property has been leased, re-let, sold in the last 3 months? NOTHING!!! Even the signs advertising the places are showing severe signs of distress. All I see are removal trucks, new For Lease signs and still greedy landlords, whose head must be so far into the sand, that they are brain dead. For instance .... landlord wants to review my rent. NO discussion - just the RERA Index and that I am way below the market. A 20% hike to 145k for average 3 bed villa in Al Satwa is the demand. I say no, market is heading the other way ... may be a 20% drop. Let's discuss and reach acompromise. May be pay something more, but not 20%. No compromise. I decide to move out ..... around mid-July when lease expires. In fairness, I offer for the Agency to send through new prospective tenants to try and help the landlord out to re-let a.s.a.p. New asking price they tell me ... only one came through to view .... is now 175k!!!! HAHAHAHAHA... still laughing now. They were astounded and laughed with me. A 3 bed villa, fully appointed and gardens in the gated communities is only 130-140k, with 12 chqs. So you see, reality is not here yet and boy, watch out when it arrives. Many glum faces will be around to greet you - these will be the landlords - begging you to consider their place, with many more benefits and payment options. Pity those on huge rentals now. Stick it out and renegotiate - you will be heard and you will make savings! Can't wait for summer to set in and then Ramadan and then Eid.... watch what happens to the market between now and then. Freefall will seem only a mild word....