Jones Lang La Salle have become the latest prominent real estate company to put their weight behind the recovery in the Dubai property market, saying that the market has bottomed with prices now at early-2008 levels and a generally positive rental market.
With developments like Jumeirah Park and Dubailand due for completion this year at 4,242 units and 4,380 units respectively, JLLS predict that 28,000 units will come online in Dubai this year. This is 75 percent higher than the 16,000 estimated by the Real Estate Regulatory Agency. Dubai Marina and Jumeirah Village are also expecting over 3000 more units this year, and Dubai Silicon Oasis and International City almost 2000.
In the first quarter alone, 3000 units were added to the total residential stock in Dubai, 44% of which was located in the sub-markets of International City, Dubai Marina, Discovery Gardens, Jumeirah Lakes Towers and Dubailand. This left total supply at 341,000 units.
"While liquidity is returning to the residential market and some previously stalled projects are recommencing, we expect that a substantial proportion of the supply due to enter the market in 2012, much of which was initially due to complete in 2011, will experience further delays," the JLLS report said.
Quoting the Reidin Residential Sale Indices, JLLS said the residential market "looks to have bottomed out," with prices currently at rates similar to early 2008 levels.
The report said that the villa market began to see "some up-tick" towards the end of last year, and this trend has continued this year with sales up 3% compared to last January but still 25% below their 3rd quarter 2008 peak.
Despite seeing a sharp fall from its peak levels in the third quarter 2008, the villa market began to see some up-tick towards end-2011.
Apartment sale indices have also begun to stabilise, but remain at lower levels, 34 per cent down on the peak in Q3 2008, said the report.
Read more on the Dubai property market
- Thursday 19 April 2012