Dubai’s prime residential areas are expected to witness ‘steady and sustainable’ price increase in 2013, according to real estate experts.
2013 Dubai property forecast: Palm, Meadows, Emirates Hills, Downtown will see price hikes
High-end villa developments will outperform secondary villa markets
Established villa communities such as Palm Jumeirah, Meadows and Emirates Hills will remain attractive locations for buyers over the secondary villa markets, while on the apartment side Downtown Dubai will continue to dominate.
“Although I feel the rate of growth will be somewhat more reserved to that of 2012, I still feel that in relative terms the same segments of the UAE market will continue to improve. Apartment’s prices in key, prime locations, such as Downtown Dubai will see the highest increases throughout the coming year,” Richard Paul, Associate Director, Cluttons Dubai, told ‘Emirates24|7’.
High-end villa developments, such as those found on the Palm, Meadows and Emirates Hills will continue to outperform secondary villa markets.
“Generally any development that provides quality specifications, design and most importantly excellent location will see growth through the next 12 months.”
In November, Knight Frank, a global property consultancy, said Dubai’s status of being a "safe haven" for Middle East and North Africa buyers pushed villa prices by almost 20 per cent in the past year (September 2011-2012).
Mohanad Alwadiya, Managing Director, Harbor Real Estate, believes prices will continue to increase in 2013.
“The price of properties, particularly villas has grown significantly over the past 18 months. The best performing areas have been the Villa project and Arabian Ranches where price appreciation has reached around 25 per cent over the past year. To suggest that this rate of growth will continue is unrealistic, but it does not mean that a more sustainable growth rate of around seven per cent cannot be achieved.”
He expects villas, particularly those in established communities, will continue to represent solid investment opportunities.
“This is mainly due to a shortage of supply of quality product which is expected to continue for at least the next three years and the renewed demand which has sprung from fresh capital inflows from overseas over the last 18 months along with domestic demand resulting from an overall improvement in the local economy, credit availability and population growth.”
Although Deepak Jain, Head of Strategic Consulting, Mena at Jones Lang LaSalle, says prices in 2012 showed a robust growth in the quality areas, he states it is difficult to say whether prices will continue to grow at the same or higher level.
“Also we have seen a lot of new projects announced, this increase in future supply will also put pressure on pricing. We may continue to see steady growth in primary locations, but as we have indicated new supply may soften the growth.”
In its Global Market Perspective Fourth Quarter 2012 report, JLL revealed that price recovery was most evident in the villa sector, which jumped 23 per cent year-on-year (Q3 2011 vs. Q3 2012), compared to the apartment sector where prices increased by just four per cent.
Ramadoss Venkateshwaran, Assistant Manager, Real Estate Department, Kuwait Financial Centre (Markaz), however, rules out any “dramatic” price increase.
“In Dubai as well, we have equal or more number of expected to be delivered during 2013. Thus, we do not expect any dramatic rise in the overall price levels driven by fundamentals. However, any liquidity flow driven price rises could not be ruled out,” he reveals.
Last week, the UAE Central Bank issued a circular capping home mortgage to 50 per cent of the property value for the first purchase and 40 per cent for second and subsequent purchases. The comments from the experts were made prior to apex bank’s directive.
Latest jobs available
- AccountantFiduciaire du Moyen Orient ,Beirut, Lebanon2014-03-10
- Safety OfficerAPM Terminals Bahrain ,Bahrain2014-03-10
- QA/QC Engineer-Steel StructureJINGGONG STEEL INTERNATIONAL ,Riyadh, Saudi Arabia2014-03-10
- Personal AssistantGulf Medical ,Jeddah , Saudi Arabia2014-03-10
- Junior/Senior Sales Executives,Dubai, United Arab Emirates2014-03-10