“The residential real estate conditions in Western Pennsylvania are favorable, so investing in a home now is a safe move,” George Hackett, president of West
What does the future hold for the Dubai property market?
Dubai properties have been showing stability over the past few months. There has been stability in the property values & in terms of monthly transactions that have taken place on properties that are ready.
The strong US dollar and low oil prices are likely to remain headwinds for the real estate sector in 2016.
According to a top Dubai real estate market analyst “Property prices in Dubai are still declining, following an unsustainable surge in recent years.” you can read more about or continue as follows:
According to Dubizzle Online Classifieds site’s report:
“Dubai’s property market is showing signs of bottoming out.”
The company’s second-quarter property report showed that prices per square foot in Dubai were generally flat quarter-on-quarter, although there were variations within individual areas.
Prices in Business Bay rose by 3 per cent to Dh1,519 per sq ft, but fell by 3 per cent in Dubai Marina to Dh1,625 per sq ft, by 2 per cent at Palm Jumeirah to Dh1,943 per sq ft and by 1 per cent in Jumeirah Lakes Towers to Dh1,219 per sq ft.
“Sale prices [in Dubai] have decreased since mid-2014,” said Ann Boothello, the senior product marketing manager for property at Dubizzle.
In May 2016, Dubai´s all-residential property price index (RPPI) fell by 5.35% y-o-y, according to RPPI. When adjusted for inflation, house prices in Dubai fell by 6.86%.
Apartment sales prices in Dubai fell by 5.15% (-6.67% in real terms) during the year to May 2016.
Villa sales prices fell by 6.05% (-7.55% in real terms) over the same period.
Dubai’s RPPI is calculated monthly and covers 7 cities, 8 main districts and 4 major projects.
The continued sales price decline, according to JLL MENA, is due to:
- the stronger US dollar, which hit the purchasing power of overseas investors from non-US denominated countries;
- lower oil prices similarly cut the purchasing power of investors from nearby oil-producing nations.
Dubai´s property transactions dropped by 25% y-o-y in terms of value in the first quarter of 2016, while transaction numbers were down by 17% y-o-y. The total value of transactions was AED 267 billion (US$ 72.7 billion), 49% of which were sales, while 44% were mortgages. Dubai´s residential price declines were slower than in the previous months, suggesting that the market may be close to bottoming out.
Rents were generally 2 per cent lower across the market.
The softening of property values in Dubai is expected to continue this year, according to Cluttons. Due to factors such as global economic conditions and higher costs of buying properties (partly due to the Federal Mortgage Caps), a recovery in the housing market seems unlikely at this point in time. The prospects for 2016 suggest a further soft landing in the real estate sector. Although demand continues to grow, the rate of growth is slowing as the overall economy adjusts to a sustained period of lower oil prices.
According to Emirates NBD, Dubai households reported the slowest rise in rent renewal prices in the short survey history. People living in apartments were more likely to report a rise in their rental price than those living in villas.
Real estate agents in Dubai have indicated a subdued end to 2015 for the Dubai property market, with nearly half expecting a further fall in values during this year. Looking ahead, around 47% of real estate agents said they expected a fall in Dubai property values over the course of 2016, while 32% forecast a rise. Survey respondents noted that market conditions would favour buyers over the next 12 months, as construction volumes look set to remain strong while the uncertain economic outlook has acted as a brake on investor demand.
According to Consultancy firm ASTECO, Dubai Property prices and rental rates in Dubai are expected to fall further in the forthcoming 18 months. This is due to the substantial supply of housing stock which is planned for handover.
Furthermore, this will have a knock on effect in the Northern Emirates of the UAE. If Dubai property market continues to soften, especially in rental values we could see decreasing rental prices in Sharjah and Ajman. The Dubai Property Market experienced a 3% fall in rentals Apartment rentals quarter-on-quarter and a 2 % decline in sales during the same period.
Rents are reported to have fallen by 5% year-on-year, the property prices in Dubai are being diluted by an abundance of new stock coming onto the market. Approximately 2,200 homes were handed over in the first quarter of 2016. With a further 27,000 units scheduled for completion inside 2016.
Despite the current trend of the Dubai property market loosing value, consultancy firm JLL say that the prospects for the Dubai property market remain healthy and suggestion that new projects such as Emaar Properties’ recent announcement of the new tower to be built taller than the world’s tallest Burj Khalifa is an example of positive market sentiment.
This sentiment is also echoed by Asteco, in the medium to long term, the major infrastructure projects, such as the Dubai World Central (DWC), Al Maktoum International Airport and Expo 2020, will all continue to create employment opportunities and therefore increase the housing demand.
Most residential housing demand in Dubai has recently come from Indian, British, and Pakistani Buyers.
Pakistanis bought property worth three billion United Arab Emirates (UAE) dirhams (around Rs85bn) in Dubai during the first half of 2016, just behind Indians and Britons who plunked down 7bn and 4bn dirhams, respectively.
In the last two-and-a-half years, Pakistanis have invested over 18bn dirhams (Rs512bn) in Dubai realty market, according to reports based on Dubai Land Department appeared in the UAE media.
In 2015, Indian nationals ranked the highest value foreigners, making property transactions worth 20bn dirhams from 8,756 investors. Britons came in at second with a total of 10bn dirhams worth of property transactions from 4,889 investors while Pakistanis ranked third with 8bn dirhams from 6,106 investors.
In 2014, Pakistanis were at second position with 5,079 transactions with a total of 7.59-dirham investment. Indians topped the list with purchase of 18.1bn dirhams worth of property on 7,353 transactions, whereas Britons invested 9.32bn dirhams.
The Reasons Why People Love Dubai Properties
- There’s a property for everyone
Dubai properties are available and can be bought or leased according to one’s wishes. The great thing is that the prices range and there is a property for everyone. They range from top of the range, and these are high class Dubai properties that are developed for the wealthy. The next are the middle range for the middle class and these are mainly office spaces and apartments.
- Multi Culture
Dubai city has a reputation of being one of the best places to live in the world at the moment. It is a diverse place that is open to hosting all people of different cultures from around the world. There is world class infrastructure in Dubai that gives you many options of choosing what you want. Dubai real estate is also diverse and caters for everybody’s needs. The great weather that is in Dubai is another factor that makes it a great place to live and it is one of the reasons many people have moved there.
The weather in Dubai encourages outdoor activities and people go visiting the beach often. There are also many Dubai properties that are located across the beach there. Living in the city is also an amazing experience since every day, there is beautiful sunshine and it is warm and pleasant. If you want to move to Dubai, it is also commendable since its economy is one of the most stable one’s in the world.
- Did you know that there are no taxes in Dubai?
This is another reason to move to the great city. Whichever organization you are working in, you will not be asked to pay taxes. This also applies if you own your business. The reason you may be looking into moving into Dubai and you may need to learn about Dubai properties is the amazing high standards of living that are there. The government offers incentives to investors who set up their business there and there are free zone areas.
Dubai also receives many visitors over the year including holiday makers, tourists and travelers. All these people require a place to stay and Dubai properties cater for them. There are many hotels, resorts and even apartments in Dubai that can host all these visitors. Some of the things that attract people to Dubai are the skyscrapers and buildings that are spread across the city, like Burj Al Arab, Al Arab and the famous Burj Khalifa. World Dubai and Palm Jumeirah also attracts many foreigners & visitors.
Dubai Real estate prices in the U.A.E. also offer you more money as compared to the prices of property in Europe. The shopping malls around Dubai apartments also make them easily accessible. This is one of the best times to purchase property in Dubai since the prices of homes are falling. One of the factors that has led to the falling prices is the lower oil prices and strong dollar. That’s how Dubai properties market is the biggest in the Middle East.