House Prices Up Again In Dubai
Published: 6/30/2009
Dubai’s property market has enjoyed another perk this month as home prices have raised further. The rise in the average prices of homes within 13 main areas in the region is around 6.5% (to Dh1.285 per sqft) in comparison to last month. After a fall in house prices of as much as 40% since last October, this comes as another welcoming sign of recovery for the market.
Deutsche Bank which has been analysing these recent trends has said that this increase in house prices is most likely due to the relaxing of the pressure from distress sales and to sellers being much less willing to sell at recent current prices. Furthermore, we are told that prices are also increasing possibly due to volatility resulting from the small number of transactions that are taking place. Although the transactions indicate that the worst of the property downturn has passed, we may still yet see further decreases of between 15 and 20% in prices before the year is over. Nevertheless, these price rises are modest enough and no doubt show that the property market has turned a big corner after a nine month course of decline due to the global economic situation.
Similarly, in this month of June, transactions seem to be continuously on the rise. During the week of 16 Jun-23 Jun 1,018 sales, mortgages and leasing transactions took place in Dubai whilst this figure was only 439 during the previous week. The volume of transactions was at its greatest since its peak earlier on in the year from distress sales. This information is learned straight from the horse’s mouth from REIDIN.com – a website which receives updates directly from the Dubai Land Department on a daily basis.
We have also heard from property brokerage Engel and Voelkers, that there are quite a lot of positive indicators occurring in the market with people having taken advantage of available options once the property prices had come down to more affordable figures, the many families making the switch from apartments to villas, and also the many buyers and renters that are seeking to move to more superior neighbourhoods.
Engel and Voelkers have noted two further trends; firstly that buyers and renters are showing much more interest in the quality of a property prior to closing a deal on it, including the property’s finishes, landscaping and location. Secondly, market trends are displaying renewed interest in certain areas, such as Jumeirah Lake Towers, which were more strongly affected by the fall in house prices.