New ValuStrat report says Dubai prices fell by 3.8% in Q2, the sharpest quarterly dip recorded in four years
Average Dubai property prices are 20 percent below peak values recorded in mid-2014, according to real estate consultants ValuStrat.
The ValuStrat Price Index (VPI) for residential properties in Q2 was down 3.8 percent since the previous quarter, the sharpest quarterly dip recorded in four years.
Its second quarter 2018 Dubai real estate review said that recent price declines may have boosted sales, as transaction volumes and average ticket sizes both increased across the board.
ValuStrat said quarterly declines of more than 5 percent were registered in locations such as The Springs and Meadows, Jumeirah Islands, International City, Downtown Dubai, Business Bay, Motor City, The Greens, and The Views.
However, villas on Palm Jumeirah and in Emirates Hills continued to resist downward pressures with only marginal dips.
The VPI showed that all 26 freehold locations monitored witnessed price drops since the last quarter, ranging from 0.2 percent to 6.1 percent but transaction numbers increased across the board, with off-plan sales volumes up 10.9 percent annually and 18.7 percent quarter-on-quarter.
The numbers of secondary properties sold also rallied, up 1.5 percent annually and 10.2 percent on a quarterly basis.
ValuStrat said areas that witnessed substantial off-plan sales transactions during the last three months included Business Bay, Downtown Dubai and Jumeirah Village.
“Recently announced government incentives towards investors, and record low prices seemed to have encouraged the quarterly double-digit growth of residential homes and office space transactions. This is despite the fact that the Ramadan season fell in the second quarter this year, typically not a very busy time for real estate deals,” said Haider Tuaima, head of Real Estate Research at ValuStrat.
ValuStrat also said overall residential asking rents fell 8.4 percent compared to Q2 2017 but fell just 1.7 percent on a quarterly basis.