Dubai properties are now cheaper
Residential and office property sales in Dubai fell sharply in the third quarter of 2016, according to the latest report by leading property broker Chestertons.
Expert: Robin Teh, Country Manager – UAE & Valuations & Advisory Director, MENA
Transaction volume: Decreased by 24 per cent
Transaction value: AED3.45 billion, down by 29 per cent compared with Q2
Most popular area: Marina, sales worth AED654 million
Dubai Marina will always be an attractive location for investors, with consistently high levels of yields. The highest transaction values remained in the prime areas, such as Emirates Living, Palm Jumeirah and Downtown Dubai. However, as investors bide their time on the bottoming of the Dubai market, total transaction volume and values dropped in the last quarter, compounded by the traditional lull in activity due to the summer and holiday season.
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Villa and apartment sales prices: Dropped by nearly 1 per cent
Areas where apartment prices fell: Business Bay (AED1,350 per sqft), Discovery Gardens (AED850 per sqft), International City (AED695 per sqft) and The Views (AED1,470 per sqft)
Where apartment prices remain unchanged: Dubai Motor City, JLT and Remraam
We expect prices to remain at stable levels leading up to the end of 2016.
Transaction volume: 24 per cent less compared to Q2
Transaction value: AED389m, a drop of 20 per cent
Most popular area: Business Bay, followed by JLT
Apartment and villa rents: 1 per cent drop across unit types
One-bedroom apartments: Remraam at AED 57,000 per annum
Two-bedroom apartments: Downtown Dubai, JLT and the Greens dropped 2 per cent
Three-bedroom apartments: DIFC, Downtown Dubai and Dubai Marina unchanged
Four-bedroom villas: Arabian Ranches at AED 245,000 per annum
Palm, JVT and The Springs remain unchanged
Demand remains relatively stable, with tenants having more negotiating power in the current market. Job losses and lower spending capacity have placed pressure on rates in Q2 and Q3 2016.
Apartments: 6 to 8 per cent
Exception: International City and Discovery Gardens, where yield is 9 to 10 per cent
Villas: 4-6 per cent
Exception: Palm Jumeirah and Jumeirah Islands, where it is 3 per cent