Dubai prices see seasonal slowing

Dubai is witnessing a seasonal slowing in price appreciation, said a report yesterday. The residential market recorded a 1.6 per cent month-over-month gain in June, the figure still indicative of a slower price appreciation compared to the 4.4 per cent in April and 3.5 per cent recorded in May, said Al Mal Capital's Real Estate Monthly Report for June.

"There is a seasonal slowdown relative to the last few months where prices increased over three per cent. However, I expect that we will see a further pick up in the pace of price appreciation in the fourth quarter this year which is a seasonally strong time of the year," said Robert Mckinnon, Managing Director, Equity Research for Al Mal Capital.

"The summer this year however continues to be stronger than last year, which saw a mere 0.6 per cent increase this time last year," he added

The commercial realty in Dubai has marginally recorded a higher appreciation than the residential segment since last year. While the commercial properties in Dubai grew by 42.7 per cent year-on-year, the residential segment grew by a marginal difference at 40.8 per cent for the same period, said Al Mal Capital's Real Estate Monthly Report.

Rental yields declined in June to a median rental yield of 6.8 per cent compared to 6.9 per cent in May owing to higher property prices even as median rents have been relatively flat the last three months. For commercial properties, the median rental yield also declined slightly to 12.4 per cent in June from 12.8 per cent in May.