The latest report from CBRE pegs average sales prices growth at around three per cent quarter-on-quarter in Q3, bringing the annual growth close to 23%. Advisory firm JLL also suggests that the market has cooled off, with average residential sales prices in Q3 2014 up by just one per cent quarter-on-quarter, down from six per cent in Q2.
Factors behind this cooling off include tighter government regulations and an increasing mismatch between buyer and seller expectations, the JLL report said.
New regulations by the government such as doubling the transaction fee to four per cent and capping mortgages has had a significant impact on Dubai’s real estate market, agreed Steve Morgan, CEO, Middle East at Cluttons.
“Last year there was a significant increase in prices, but the regulations have had a levelling effect on the marketplace. The price growth couldn’t have continued in the same pace. With the market maturing, we will see small increases in certain areas, but they will be more in line with what you would expect in global markets,” he explained.