Values Fall, Prices Rise in Dubai Real Estate

Dubai property has been evaluated at a 26% low in the first half of the year 2012 as per the sources in the Real Estate Appraisal Centre (REAC). A total of 1090 properties in Dubai were surveyed by REAC at Dubai Land Department and there was a depreciation of AED 42 billion in the values of the properties.

Mr. Muhammad Al Dah also highlighted that the number of transactions in property market drop by 3% every year and during this first half of the year the values of the already owned properties devalued by an average of 26%. He also gave some suggestions to curb the deflation of the assessed properties which were as follows:

1)      Increase investor’s confidence in the real estate business.

2)      Price stability should be improved.

3)      Market should be allowed to get mature that happens only with time.

The data taken from the applications that were received by the Dubai Municipality that comprised 30% of the total properties valued while 18% of them are from Dubai Courts. The rest were taken from different sources like the applications filed in the banks for loans, grants and also from the auctions etc.

The latest survey that surfaced after the second quarter was Knight Frank Prime Global Cities Index which revealed that during the Q2 the property prices rose by 2% but the rate at which the property prices have been rising for the last few months was 5.6% so there is a bit of a brake in the rise but the overall position is now getting stable as there is no further decline reported for the last at least 6 quarters and it is generally believed by the investors that the Dubai real estate is now getting stable and mature. The price growth during the last twelve months has remained at an average of 2.3%. And Dubai ranks at 12^th among the 27 real estates that were surveyed by this index. It is quite evident that the tough times are over and it will only get better from this point.