Mixed news for Dubai real estate prices
Year-on-Year gains, but outlook bleak says report.
Real estate prices have fallen slightly in Dubai through the year, but have increased since the same period last year, according to a new report.
The document, released by analyst firm Colliers International noted a 4% decrease in house prices since Q1 2010, the first quarter-on-quarter contraction to be registered by the index in 12 months.
However, compared with the same period in 2009, overall prices are up about 7%.
Additionally, number crunchers at the firm worked out that the price per square metre had dipped to AED10,915 down from AED11,420 in the first quarter of the year.
However, the report’s authors caution that forthcoming housing supply and declining rental incomes are likely to further pressure house prices.
“We anticipate a further slowdown and we have an ongoing concern of the new supply entering the market, which will further impede recovery,” said Ian Albert, a regional director at Colliers International.
“There are already more than 340,000 residential properties in Dubai with an average occupancy rate of 87%, with further declines anticipated. The market simply cannot absorb the additional supply unless the population grows and/or the release of stock is slowed down,” explained Albert.