Prime Dubai property sales doubled in the first quarter compared to the quarter before, according to new data released by a local luxury realtor.
Luxhabitat said homes in areas such as Dubai Marina, the Palm Jumeirah, Downtown and Arabian Ranches posted sales worth AED3.2 billion ($870 million), a steep rise on the AED1.6 billion seen in the final quarter of last year.
The agency also said that figure compared to a 16 percent drop in overall sales across the city. Its data showed that apartments in prime areas sold three times as much as villas.
However, the prime market also saw a 1 percent drop in values during the quarter, compared to an overall drop of 2 percent in Dubai as a whole.
Explaining the growth in sales, Luxhabitat’s luxury sales director, Ian Kirkby, said: “The main reasons include the new accounting policies from private banking in the European countries, changes in tax laws in India and the general global economic situation. A lot more UHNWIs [ultra high net worth individuals] are finding Dubai to be a safe haven for investing their properties.”
Earlier this week, the head of a local real estate advisory firm warned reports suggesting that Dubai’s property market is on the brink of a turnaround could have an adverse effect on the sector.
The managing director of Phidar Advisory made the comments in the company’s first quarter report into the market, where it said residential prices had dropped during the period and forecast further declines.
“There has been a flurry of positive headlines over the past month with limited evidentiary support or analysis,” said Jesse Downs, in a press statement. “Research indicates unsubstantiated optimism can have a destructive impact on a market.
“The available real time indicators do not support the story of a short term turnaround. And ignoring the bad news now can create a crisis later.”
Phidar Advisory said its Dubai Real Estate International Demand Index (REIDI), which measures propensity for investment in property, dropped by 2.2 percent in the first quarter compared to the same period a year earlier.
Its research also showed that apartment rents dropped by 2.1 percent, while sales fell by 1.9 percent. Villa rents slumped by 4.7 percent while sales rose by 1.6 percent. The firm said the latter figure followed a quarter-on-quarter drop of 7.9 percent in the last quarter of 2015.For all the latest real estate news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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