Prices in Dubai declined 3.8 per cent year on year in Q3 2018.
Prime property has become more affordable in Dubai as prices continued their downward trajectory in the third quarter of 2018. The emirate was ranked 39th in the Global Residential Cities Index by consultancy Knight Frank.
The real estate consultancy said prices in Dubai declined 3.8 per cent year on year in the third quarter of 2018; 4.2 per cent in the last six months and 2.6 per cent on a quarter-on-quarter basis. Dubai prime property prices witnessed the second highest decline in the Middle East after Istanbul, which saw a 6.3 per cent drop in super prime home prices.
Shaher Mousli, chairman, Arthur Mackenzy Properties Group (AMPG), said the year-on-year downward variation of 3.8 per cent is a mere fluctuation as opposed to a decline.
“A fluctuation of 5 to 10 per cent in any prime location can easily attribute to this variance. In my opinion, a blanket variance of -10 per cent can be referred to as a decline, which is surely not the case here. For Q4, I do not see any major shift and the market will remain stable till year-end and perhaps extend to Q1 of 2019 during which I predict a positive uplift,” said Mousli.
According to real estate services firm Chestertons, an additional 10,000 units are expected to be delivered in Dubai this year and another 70,000 before Expo 2020. Apartment and villa rents have declined four per cent and three per cent, respectively, in the third quarter while sales prices for both property classes declined by six per cent, with the trend expected to continue into 2019.
Prime property prices in Dubai witnessed the fifth highest decline in the list of top 43 cities worldwide. The biggest drop was recorded in Vancouver, Istanbul, Stockholm, Taipei and Dubai. The top five gainers were Singapore, Edinburgh, Madrid, San Francisco and Tokyo.
Singapore leads the index with prime prices up 13 per cent over the 12-month period, driven by the limited availability of prime properties and a strong market outlook in the first half of 2018.
In London, prime prices dipped 2.9 per cent in the last year as uncertainty around Brexit continued. This trend has been exacerbated by a growth in supply as more landlords attempted to sell their property following tax changes.
“Buyers are residents who are looking to upgrade their lifestyle,” said Daniel Garofoli, luxury sales specialist at Luxhabitat.