Sep 05 2011
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Dubai property prices and rentals stabilise in Q2
Study says decline in prices and rentals slows; Downtown apartment prices record biggest decline of 8%
Apartment rents in Dubai fell two per cent after registering a similar decline in the first quarter, Global Investment House said. Villa rents remained stable without any significant declines after falling a mere percent in the fourth quarter of 2010.
Apartments in Downtown Dubai saw the maximum decline, falling eight per cent quarter-on-quarter while Dubai International Financial Centre dropping seven per cent on new supply. Overall, selling prices fell three per cent. Prices of villa in established areas continued to maintain their first quarter level, while larger size and/or new villas dropped three to five per cent.
In March, Rasmala Investments predicted that house prices in the UAE may drop by an additional 25 to 30 per cent as population growth stagnates and more properties are constructed. Jones Lang LaSalle estimates, home prices in Dubai will fall further as 54,000 houses comes onto the market between 2011 and 2015, while Abu Dhabi is expected to receive about 50,000 houses (16,000 will be ready this year) by 2014.
Offices 'under pressure'
Office market remained under pressure in both the emirates on the back of persistent oversupply and "feeble" business demand.
In Dubai, office rents fell six per cent over the previous quarter with Dubai Investment Park registering a decline of 15 per cent while Jumeirah Lakes Towers dropping 12 per cent. City wide vacancy rates remained at around 45 per cent.
Office rents in Abu Dhabi dropped four per cent after falling nine per cent in the first quarter. Grades B and C offices are continuing their "underperformance" as tenants upgrade to better office space at affordable prices. Selling prices moved down three per cent, the report said.
In July, Craig Plumb, head of research, Jones Lang LaSalle (JLL) told this website it now estimates future office supply in Dubai to be around 1.8 million square metres, roughly 30 per cent lesser than they expected between 2011 and 2013. It earlier said Abu Dhabi will get an additional 1.2 million square metre of office supply before the end of 2012.
© Emirates 24|7 2011
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