Dubai
Villas in Dubai have faced the brunt of investor concerns, with those units priced upwards of Dh10 million seeing a 44 per cent drop in the last 12 months.
Sales prices per square foot for villas on the Palm remained “relatively steady with just a 4 per cent year-on-year drop as landlords continue to command prices for well-maintained or refurbished properties,” says a new report from Core, the consultancy.
“With a total stock of approximately 1,700 villas, an estimated 150-200 villas are currently available for sale on Palm Jumeirah,” said David Godchaux, CEO. “More units are anticipated to be held by investors as many are not pressed financially to sell in this bottoming market, while a few others look towards commanding premiums by refurbishing existing units and attracting buyers who are seeking contemporary products.
“A strong recovery in prices is not anticipated in the near term as we expect this underlying stock to keep the sales prices static even if the demand revives in the coming quarters.”
Transaction activity levels on Palm Jumeirah villas was down by around 25 per cent over the last 12 months.
Overall sales activity levels in Dubai Marina dropped 25 per cent, while prime apartment sales volume saw a fall of 43 per cent year-on-year.
“However, Dubai Marina witnessed the highest transaction activity in the apartment segment over the last few years,” said Godchaux. “As expected, headline occupancy levels are nearly 90% in top performing towers and the prime rental market has remained relatively steady due to the continued demand from expatriates.
“Nonetheless, prime sale prices have dropped 8 per cent year-on-year, although this has created investor opportunities through stable yields averaging between 5-6 per cent.”
