Which Dubai communities saw prices fall or rise? Click to know - Emirates24|7

Which Dubai communities saw prices fall or rise? Click to know

Dubai property prices have witnessed a “slight” correction in the past three months (June to August 2014), but prices still remain in the positive territory on an annual basis, reveals the September Mashreq Property Wealth Gauge report.

The highest increase on an annual basis (August 13 to August 14) was recorded in International City, where prices rose by 28.8 per cent. Business Bay was next with a 26.2 per cent increase, followed by Dubai International Financial Centre 20.1 per cent, Dubai Marina 15.9 per cent and Jumeirah Lakes Towers (JLT) 15.8 per cent.

The Mashreq report disclosed that the percentage change in property prices over the last three months (June to August) indicated a declining trend across major locations.

The highest decline in the three month period in Jumeirah Park. The master development saw prices falling by 3.5 per cent. Greens saw a decline of 3.1 per cent, Springs/Meadows fell 3.4 per cent, Arabian Ranches dropped 3.3 per cent and Jumeirah Village slipped 2.6 per cent, Dubai Marina declined 0.2 per cent and JLT fell 0.9 per cent.

Jumeirah Beach Residence reported the highest gain in the June-August period, which saw prices rising by 3.2 per cent. Annually, the increase was 15.2 per cent.

Property consultants have reported that the community had seen decline in investor demand over the past few years, mostly due to the ongoing infrastructure work. However, completion of the work on tram network is set to make it an attractive community, leading to increase in prices and rents.

Healthy correction

The real estate market was witnessing a “slight” correction, driven mostly by two factors one being the UAE Central Bank mortgage regulation and the Dubai Land Department increasing the property registration fee, Pawan Dhawan, Vice President, Mortgages, Mashreq said while speaking at the Dubai Real Estate B2B Conference on Wednesday.

“The moves have come down very well… there is a ‘slight’ correction, which is healthy for the market,” he asserted.

Mashreq is among the top three banks in the mortgage lending business, commanding a market share of 13 per cent and doing business of over Dh2.5 billion a year.

Dhawan believed the market still had an upward potential as it was far below the 2008 peak levels, citing the case of JLT where rates now stand at Dh1,400 per square feet compared to the highs of Dh1,900 per square feet during the peak.

Earlier, UK-based Knight Frank said the pace of increase in property prices in Dubai had slowed, but compared to 53 other global cities they are still increasing at the fastest pace in the world.

Dubai continues to top the annual rankings for the fifth consecutive quarter, recording an annual price growth of 24 per cent though it has dipped from 27.7 per cent in the year to March 2014, the latest Global House Price Index revealed.

Billion dollar boost

Jurgen Herre, Managing Partner, Soliton Holding, said he was expecting flow of “billions of dollars” in Dubai’s real estate market, primarily from institutional investors.

“We expect billions of dollar being invested by institutional investors in coming five years,” he said while speaking on the Expo 2020 impact on Dubai real estate market.

Dubai, Herre said, was investing $8 billion in building the infrastructure for the expo that will being in excess of 25 million visitors.

“Dubai is investing 7.5 per cent of its gross domestic product (GDP) in building the infrastructure for the expo. In comparison, Germany invested just 0.96 per of its GDP in 2000; Japan 0.55 per cent of its GDP in 2005; China 0.51 per cent of its GDP in 2010 while Italy is investing only 0.50 per cent of its GDP for 2015 expo,” he revealed.

Dubai will hold Expo 2020 from October 2020 to April 2021. In the run-up to the event, nearly 277,000 new jobs will be created.