Real estate price declines will start slowing down in the Dubai property market soon as per several studies and reports. The real estate sector in Dubai will be hovering somewhere near the market bottom-line according to reports while the period of stabilization is witnessed in the Emirate over the next few years. The rate of sales declines and rental price declines will also start slowing down every quarter in the coming years as per reports.
Experts have stated that there has been a clear softening trend observed in the Dubai property market over the last few years after the upward trends seen in the year 2014. This was the year when the Emirate announced that it would be hosting the World Expo in 2020. However, rental rates and property prices have started coming down and slowing over the last 2-3 years.
Key aspects that you must note
One aspect that must be noted is the fact that the rate of price declines has slowed considerably as per latest reports. Sales prices have come down by approximately 1% for apartments and by around 3% for villas in the fourth quarter of Q4 2019 in comparison to the third quarter of 2019. Higher declines have been witnessed annually with sales prices and apartment rentals coming down by 8% and 5% respectively. At the same time, villa rentals and sales prices have come down by 8% and 10% respectively in comparison to the same time-frame in the year 2018.
Latest reports and studies have shown that some of the primary areas in Dubai like Dubai Marina and Downtown Dubai witnessed further declines in prices but performance was above average thresholds. Secondary locations such as JVC, Motor City and JVT also witnessed higher price declines. Experts have added that in spite of these price declines, the market was a long way away from its negative performance during the financial crises of 2000 and 2009 which impacted global businesses adversely.
Industry experts have opined that the market is adjusting really well to fluctuating trends rather than seeing any bubble bursting or any cracks. The situation is actually quite optimistic and highly positive on the ground according to them. The market is more sustainable and mature in Dubai at the moment and this is being heralded as the new period of stability or normalcy by industry watchers. Rental prices and selling prices are expected to stay somewhere at the bottom threshold of the property market for some more time. Any uptick in rates and prices owing to the 2020 World Expo has already been accounted for, at the time of the official announcement in the year 2014.
The market will hold on for some more time and further declines may also be expected although these will not be drastic anymore. The decline should happen at a much slower rate, somewhere around 1-5% on an average. Some areas will not witness any price declines at all, according to experts. Tenants will continue to be in an advantageous position in the market along with property buyers. The high sales figures in 2019 should definitely continue into 2020 as well, owing to positive Government reforms and measures, lower property prices and positive buyer sentiments due to the upcoming 2020 World Expo.