While rental rate declines in Dubai seem to be slowing down in the third quarter of 2019, the sale prices are forecast to see further softening for the remainder of this year, a report by real estate services firm Chestertons said.
With nearly 50,000 new units set to be delivered this year in Dubai, the emirate’s residential market is expected face the pressure of oversupply.
Average villa sale prices declined 3 percent in the third quarter, while apartment prices were down by 4 percent from the previous quarter.
“As we anticipated, there were further sales price declines in Q3 for both apartments and villas due to excess supply and muted economic growth. The rental market proved to be more resilient however, with a marked slowdown in the rate of decline,” said Nick Witty, Managing Director, Chestertons MENA.
“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,” she added.
As for the rental market in Dubai, the rate of decline has slowed with average villa and apartment rates down by 1 percent, which might be an indicator that the market has started to recover, according to the report.
The volume of off-plan transactions increased by 45 percent, while their value gained 46 percent to AED 10.5 billion.
(Writing by Nada Al Rifai, firstname.lastname@example.org, editing by Seban Scaria)
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