Dubai could face another 20 percent decline in property values over the next 2 years, while poor apartment performance in November suggests a sour ending for 2010. Third quarter results reflect weakness in Dubai’s residential market, with a small increase in villa prices insufficient to offset the sharp losses for apartments. See the following article from Property Wire for more on this.
Apartment property prices in Dubai fell significantly in November in all categories apart from those in the 51 to 100 square meter category, the latest figures show.
Prices rose marginally in this sector month on month, the data from REIDIN, the leading real estate information company covering emerging economies, shows. It is based on transaction figures from the Dubai Real Estate Authority and is regarded as a reliable benchmark.
Prices in the 50 square meter and less category are now 17.55% below November 2009 and fell by 0.1% on a monthly basis, the figures show. In the 51 to 100 square meter sector the average price has decreased 9.06% year on year and 0.11% month on month in November 2010.
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While in the 101 to150 square meter segment the average nominal price decreased 6.3% year on year and 2.31% month on month and prices in the 151 square meter and more sector have fallen by 7.91% year on year in November 2010 and decreased by 2.36% month on month.
Overall, apartment prices decreased by 1.12%, while villa prices fell by 0.81% in November 2010 compared to October 2010.
The REIDIN.com SPID All Residential dropped by 8.36 points in the third quarter of 2010 to 167.60 basis points, a 4.75% decrease from the third quarter of 2009. At the same time, the apartment index declined by 7.48%, while the villa index increased by 0.90%.
The firm’s research covers about seven citywide indices and a total of 19 district and project based indices to provide accurate sampling of the Dubai housing market. Earlier this month, several real estate agencies warned that prices could keep on falling for another two years.
Landmark Advisory warned that residential values may fall by as much as 20% more by the end of 2012 if the supply of new homes is not curbed while Jonathan Fothergill, director of UAE valuations at Cluttons, said that while prices would continue to decline next year, this would happen at a much slower rate and that a key factor would be those properties that are well located and well maintained.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.