Experts of the ValuStrat consultancy presented their own version of the situation analysis and further prospects of the Dubai property market: they think home prices will continue to decline, and buyers will become more active closer to the fall.
The report by ValuStrat says that decrease in house prices in Dubai in the second quarter was very much determined by a too low buyers activity: if the seller does not offer any additional benefits in the form of a convenient payment plan or willingness to negotiate, the buyer loses interest in the transaction. This is confirmed by the official statistics: according to the Land Department, 64% less residential property sales transactions were registered in the second quarter compared to the first quarter of the year.
As for the rest, ValuStrat statistics almost completely converge with those of other agencies with respect to the rate and pace of prices decline in different market segments and areas of the city. During the second quarter house prices in Business Bay fell by 6%, and even in mega-popular and cheapest areas with affordable housing prices also decreased — in the International City, Sports City and Discovery Gardens ValuStrat analysts recorded a decline of 4%. In general, over 26 Dubai districts, evaluated in the ValuStrat report, apartment prices in the second quarter decreased by 2.5%, while villas prices - by 2.1%.
Regarding the future agency's experts give the following forecast: if prices continue to decline at the same pace, it is likely that many expectative buyers will finally decide to enter the market, so we can expect its recovery in autumn months.
And in terms of annual growth, according to ValuStrat, house prices in Dubai have fallen by an average of 11% year-on-year.