Dubai residential asking rents were found to have dipped 8.6%
Dubai’s residential property market displayed an overall 11.1 percent fall in capital values in 2018, with quarterly declines of 3.1 percent, according to a fourth quarter report from ValuStrat.
According to the report, the downward trend resulted in 24.7 percent citywide capital value loss since it peaked in mid-2014.
The report added that all the freehold locations monitored by the ValuStrat Price Index (VPI) experienced price drops ranging from 2.3 to 5.5 percent.
On an annual basis, 5 of 26 locations saw single digit declines, including villas in Palm Jumeirah, Emirates Hills and Al Furjan and apartments in Dubai Marina and Jumeirah Village Circle.
Capital values in certain other locations – including the Meadows, Jumeirah Islands, International City, Discovery Gardens, Business Bay and The Greens – fell more than 15 percent annually.
Haider Tuaima, head of real estate research at ValuStrat, said that “off-plan sale volume leaped 47.9 percent and ready sale volume jumped 24.8 percent since Q3 with more than 50 percent of purchases were for apartments priced less than AED 1 million and villas priced between AED 1 million and 3 million.”
Additionally, an estimated 19,367 apartments and villas – or 43 percent of the total supply as expected at the start of 2018 – have been completed.
Of this total, 9,454 units were mainly located in Dubailand and Jumeirah Village Circle.
“The fourth quarter often sees a pick-up in residential transaction volumes, with buyers encouraged by special sales incentives and discounted year-end pricing from both master developers and motivated home sellers,” said Declan King managing director and group head real estate. “Increasing numbers of purchasers appear to have committed in Q4.”
King added that “it will be interesting to see if this is a trend and continues into the following quarter, particularly in the face of price falls which are expected to remain in the short term at least.”
Residential asking rents were found to have dipped 8.6 percent annually. On a quarterly basis, however, rents were found to have fallen 1.2 percent. Compared to the same period last year, listed rents were down 8.9 percent for apartments and 6.9 percent for villas.
Office transaction volumes, for their part, fell 11.9 percent compared to the previous quarter, while overall transacted office prices were 9 percent lower than last year. There was, however, a notable increase of 11 percent quarter-on-quarter.
The report noted that median transacted prices stood at AED 9,451 per sq m. Business Bay was found to be the most popular choice for office shares, accounting for 53.8 percent of the total, followed by Jumeirah Lake Towers with 23.7 percent.
In the hospitality sector, Dubai’s room count stood at 89,091 as of October, with 24,418 hotel apartments. An additional 2,713 rooms were added during Q4.
Citywide, occupancy rates between January and October were 75 percent, 2 percent lower than when compared to the same period last year. Revenue per available room (RevPar) declined 7.7 percent, while average daily rates were 5.5 percent year-on-year.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.