The time may be best to buy property in Dubai as prices are falling, but rental yields remain high, according to a new report by Chestertons Mena.
"Property prices have corrected significantly over the last year with attractive bargains in some locations.
“With high rentals, this is an apt time to lock a property that will bring good yields,” said company Managing Director Declan McNaughton.
“There is a general consensus in the industry that the market will remain subdued during 2016. However, this phase could provide good investment opportunities for the long-term.
“Also, this phase will not last long as we move closer to Expo 2020. This is an ideal market for both end users and long-term property investors,” he added.
Dubai is expected to see an addition of over 3,000 housing units this year, with the imbalance in the supply and demand situation continuing to build pressure on property prices.
“We expect sale prices to correct further during the year,” said company Country Manager Robin Teh, stating the total number of transactions in fourth quarter 2015 dropped by 44 per cent to Dh24.3 billion compared to Dh33.1 Billion in the third quarter 2015.
The consultancy said an estimated 15,000 units were delivered in 2015 with a similar number being delivered over the next three years, following which “supply may reduce significantly”.
“Master developers could alter the construction and delivery cycle accordingly and this could keep the supply figures under control,” Teh added.
The property consultancy said rentals in majority of the prime residential communities remained stable in the fourth quarter 2015 though locations such as Jumeirah Park, Islands and Jumeirah Golf Estates reported rental decline of 3 per cent, 2 per cent and 2 per cent, respectively.
Overall, the villa segment fell one per cent in the fourth quarter compared to the previous quarter.