Prime residential prices have risen since the beginning of 2012. In 2013 the price of luxury villas have increased by 11.4% and prime apartments have risen 15.1% in value.
The year-on-year increase from June 2012 to June 2013 for prime residential property stands at 21.4%. The price of luxury villas picked up post January 2012, whilst the price of top-end apartments gained momentum from September 2012 onwards.
Rents across the prime sector have seen a 15% rise year-on-year to June 2013, with an increasing number of corporate tenants entering the market. •
The proposed mortgage cap announced in December 2012 has caused a flurry of activity amongst owner-occupiers, keen to purchase their homes in Dubai before legislation is enforced.
Select new off plan development launches, in the more popular areas, are selling out on release.
Director of Residential
Knight Frank Dubai
The Dubai real estate market showed
the first firm signs of recovery in early
2012 but this was not across all sectors.
“Freehold ownership of Dubai real estate
for non-Gulf Cooperation Council
Nationals has now been in existence
for over a decade. Since its inception in
2002, we saw a rapid rise in demand
and pricing up to the peak in mid-2008
before suffering a significant decline
through the global financial crisis. Now
we are experiencing its revival, but
with stronger foundations and with
Dubai gaining a safe-haven reputation
amongst buyers from the wider region.
Rapidly-expanding finance, tourism
and logistics sectors are fuelling growth
in Dubai’s more tightly regulated
property sector. In the last 12 months
the government and private developers
have implemented cooling measures to
reduce the likelihood of another housing
bubble. Our experience is that investors
are more diligent about the projects in
which they purchase.
Dubai continues to attract a mixture of
foreign buyers predominantly from the
Middle East, Europe, Asia and Africa, who
regard Dubai as a city of choice whether
it be for lifestyle, business, investment,
relative political stability or its income
and corporate tax advantages.
Prices have recovered in the prime
residential sector, nearing the levels of
early 2008 but still around 30% lower
than the market peak on average.”
Dubai: buyer nationality breakdown*
GCC exc. UAE
Source: Dubai Land Department
*commercial and residential purchasers
Leading the way were the popular family
communities, particularly established
villa developments with good amenities.
Better quality apartments were to
follow suit, particularly in Dubai Marina,
Downtown and Palm Jumeirah, with an
emphasis on high maintenance standards
and prime locations.
2013 has seen an increase in transactional
volumes along with prices. There are
concerns over the rate of price growth, and
as a result the UAE Central Bank proposed a
new mortgage cap in a circular on the 31st
December 2012. While this cap would not
effect the large portion of the market made
up by cash buyers, it was thought a positive
move as it would inspire more thought from
buyers considering their exit strategy.
The prime residential market in Dubai has
witnessed strong growth partially as a result
of investors from North Africa, the Middle
East and Asia looking to place wealth in a
Knight Frank’s Wealth Report 2013 shows
Dubai to be one of the most favoured
locations as a ‘safe haven’. It also compares
how many square metres US$1m can buy
in the world’s luxury residential markets,
and Dubai is ranked 19th out of the top...
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