Chestertons: Dubai residential market prices will drop in 2019
Apartment sale prices fell 4% and villa sale prices declined 3% in Q3 2019 as supply glut continues in market, Chestertons says
Dubai residential sales prices will continue falling in 2019 – by up to 5% in some instances – with rental rates having declined 1% in Q3 2019 due to continued pressure exerted by a real estate supply glut and an increasing delivery pipeline in the emirate, according to Chestertons' Observer: Dubai Market Report Q3 2019.
Average apartment and villa sales prices were down 4% and 3% respectively in Q3 2019, pushed lower by 50,000 new units expected to be delivered in 2019 – a 150% increase compared to 2018, when supply topped 20,000 residential units.
Commenting on the possible recovery in residential sale and rental prices, managing director of Chestertons Mena, Nick Witty, said: “We anticipate the 10-year residency visa, the economic stimulus package and perhaps more importantly, the introduction of the new real estate committee, which has the mandate to boost demand and control supply, contributing to a more favourable outlook in Q1 2020.”
In the villa sales market, Meadows and Springs were resilient with no changes in sale prices, but Palm Jumeirah, The Lakes, Jumeirah Park, and Arabian Ranches weathered a decline.
According to the report, Dubai Silicon Oasis and Dubai Motor City showed the greatest drop in apartment sales market prices.
Sale prices in Dubai Marina and the Greens, typically two of the best performing communities, fell 6% as a direct result of the current supply and demand equilibrium, Chestertons said.