|Published:||14 Feb at 6 PM|
Become aFeatured Expat
and take our interview.
Become aLocal Expert
and contribute articles.
Is Dubai’s property price collapse signalling an end to its boom years?
Over the past four years, Dubai’s property prices have slumped by a massive 25 per cent, with the fall blamed on the oversupply of high-end luxury real estate combined with the fall in oil prices. A recently released report confirms the nose-dive, with formerly fought-over prime properties on the spectacular man-made Palm Jumeirah Island dropping by a further 9.5 per cent last year. Prices in Dubai Marina with its yachts, sandy beaches and soaring Jumeirah Lake Towers fell by a similar amount in 2018.
According to upscale real estate agents in the area, a number of the townhouse and villa developments popular with expatriates and their families have also been affected by the slump.
Some 10 years ago, one-bedroomed apartments in Burj Khalifa, the world’s tallest building, could be had for $800,000 and were fetching $1 million when oil prices were at their highest but are now selling for around $550,000. Top-talent expatriates who bought before the 2008 global financial crisis accounted for most of the tower’s units, but had sold them on at top prices by the time the economic slump had taken hold. Over the past several years, developments of luxury apartments and upscale hotels on The World have stalled, with no news as to when they will be reinstated. In the meantime, property prices in Arabian Ranches and the still off-plan Business Bay have fallen by 18 per cent.
Last year, transaction activity dropped by around a quarter when compared with 2017, with buyers adopting a ‘wait and see’ stance rather than taking the plunge. Experts in the property sector believe the present situation will continue for at least two more years, with prices still having room to fall. Most are blaming the slump on the world economic situation and the increasing political instability’s effect on the financial markets as a whole, with weakening local currencies also playing a part. Whatever the reasons for the dramatic drop in interest as well as prices, now would seem to be a good time for expats in the UAE to get on the property ladder and bag a bargain before the market stabilises and costs rise again.
Comments » No published comments just yet for this article...
Feel free to have your say on this item. Go on... be the first!