Dubai property prices up again in Q3 but still 42% lower than 2008

Dubai property prices up again in Q3 but still 42% lower than 2008

01.10.2013: Market rates to rise further but prices unlikely to hit 2008 peaks in short to mid-term

Market rates to rise further but prices unlikely to hit 2008 peaks in short to mid-term says special Asteco Q3 2013 report for Cityscape Global




 
•    Dubai villa and apartment sales prices soar year-on-year by 26% and 42% respectively, but still 42% lower than Q3 2008


•    Year-on-year villa and apartment rents up 19% and 23% respectively but still 31% and 38% lower than Q3 2008


•    Office rents rise 43% over past year, but 66% below Q3 2008 peak



Although Dubai property sales and rental prices have put in another robust performance over the past 12 months, average sales prices for apartments and villas are still 42% lower than in Q3 2008, with rentals lagging 38% and 31% for apartments and villas respectively over the same period. And according to the Asteco Dubai Q3 2013 report, although prices will increase further, it is unlikely that they will hit their 2008 peaks in the short to mid-term. 


The special report, which will be distributed at the Cityscape exhibition next week, highlights the fundamentals that have been driving the Dubai market. Political stability, trade links, a buoyant and diversified economy, regulatory infrastructure and an attractive tax environment have all contributed towards a resurgence in transactional activity over the past 12 months, which has led to a significant appreciation in sales and rental prices, said the report.


Commenting on residential sales prices, John Stevens, Managing Director, Asteco Property Management said, “Sales prices for villas and apartments recorded year-on-year growth of 26% and 42% respectively. While we have seen numerous project launches and increased interest in buying off-plan properties, projects with favourable payment plans in good locations saw the bulk of demand.”


The best performing areas for apartment sales prices over the past year were Discovery Gardens, up 75% to AED700 per square foot, and Jumeirah Lakes Towers up 46% to AED950 per square foot.


In terms of 2008-2013 performance, Jumeirah Beach Residences and The Greens are 32% and 33% respectively below their 2008 peaks. On average, the most expensive area to buy an apartment in Dubai at the moment is Downtown Dubai, at AED1,700 per square foot.


In terms of villas, over the last 12 months Jumeirah Village was the standout performer increasing by 50% to AED750 per square foot, followed by Jumeirah Islands (+30% to AED1,300 per sq ft) and Springs (+25% to AED1,000 per sq ft).


Still one of the most exclusive locations for villa owners is Palm Jumeirah, commanding AED2,000 per square foot, over AED700 per square foot more than Jumeirah Islands and almost double that of any other freehold area in Dubai.


“Almost in parallel with the sales market, apartment and villa rents are still below Q3 2008 levels by 38% and 31% respectively, added Stevens.


“However, recovery is well underway with a year-on-year average rental growth of 23% for apartments and 19% for villas. We expect rental growth to continue as economic improvements fuel internal demand as well as result in new arrivals,” he said.


Given its initially low rates, International City outperformed the market over the past 12 months with a 35% increase. A one-bedroom apartment now costs AED32,500 per annum. Downtown Dubai is just 25% below its 2008 peak, with a two-bedroom apartment now renting for AED140,000 per annum.


Palm Jumeirah remains the most expensive out of the areas surveyed, where a two-bedroom apartment rents for AED160,000 per annum on average.


Villa rentals in The Springs fared best over the past year, recording a 34% increase to AED165,000 per annum for a three-bedroom house, with villas of the same size in Mirdiff increasing 31% to AED120,000 per annum. The Palm Jumeirah is still one of the most expensive places to rent a three-bedroom villa at AED350,000, which is just 10% below its 2008 peak.


“Office sales prices have seen little improvement over the last five years and are still 63% lower than in Q3 2008 while the last 12 months only saw minimal increases of 8% on average. However, despite rental rates 66% lower than in Q3 2008, the office market has outperformed residential over the past year, rising 43%, albeit from a low base,” said Stevens.


Asteco is located in hall 3, stand number 3D20, at Cityscape Global.




Steven Jones, Shamal Marketing Communications Dubai also photos

Permanent-URL: http://www.automobilsport.com/dubai-property-prices-lower-than-2008-cityscape-global-asteco---115950.html

01.10.2013 / MaP

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