With each new report on the state of the Dubai real estate market potential property investors in Dubai are making sure: prices in the emirate’s property market have stabilized and soon will start going up.
This axiom has been recently confirmed by a joint Reidin-GCP report, which recorded a margin increase in prices in the Dubai’s real estate mid-market, while annual price growth indicators for premium high-end property still demonstrate the same digits.
Property prices increased in such Dubai areas as Discovery Gardens and International City, while staying at the same level in the man-made island of Palm Jumeirah and in the most sought after Dubai’s destination of Dubai Marina. But averages not always reveal the whole truth. For example, while average Dubai apartment prices decreased annually by only 0.5% (completely deproving all the scary forecasts about double-digit decline in prices throughout 2016), villa price averages have increased by 0.5% year-on year. And we know that a large number of luxury villas is located on the fabulous island of Palm Jumeirah.
The only barrier for immediate price recovery, according to experts, is a reduced demand; therefore a gradual recent increase in demand gives hope to see property prices pick up in the nearest future. According to data voiced by Samir Lakhani form the GCP, the number of property transactions is growing not only in the medium price segment, but also in the high-end real estate domain.
A steady increase in percentage of mortgages issued by Dubai banks in the whole number of all real estate transactions is also one of the factors leading to the increase in sales and prices. And in the last four years at the Dubai real estate market, which has been historically heavily dependent on cash deals, there has been a shift form only a quarter mortgage-related property transactions to nearly half of all real estate transactions recorded in the emirate.
“In the 10 years from 2005, the population has seen a swelling in the ranks of white-collar professionals (by 48 per cent) and in the managerial class (by 87 per cent). More of them could provide a boost for Dubai’s property market, from a rental and sales perspective,” said the report.
Dubai’s population as of September 2016 is estimated at 2.56 million, while annual population growth rate is about 5.6 per cent and rising.