Dubai villa sales up 2.8pc in Q2
Dubai, August 15, 2011
Villas in Dubai continued to perform well during the second quarter of the year due to the lack of forthcoming supply in 2011, resulting in a quarter on quarter increase of 2.8 per cent, said a report.
While apartment sales in Dubai have declined by 2 per cent, the office market remains oversupplied – with the current supply at 5.2 million sq ft and another 2million sq ft to be delivered by 2014, said the Market Snapshot, a real estate report released by top property consultants Landmark Advisory.
To date, as market conditions continue to favour tenants with landlords’ willingness to provide incentives, capital values have observed a 1.7 per cent drop, it added.
Over the past 12 months, the astute research and analysis division of Landmark Properties has observed three distinct submarkets emerging within Dubai’s residential market; prime, secondary and tertiary.
“Based on transactional data and third-party research, capital values continue to decline in tertiary areas with an imbalance between supply and demand,” said Michael Michael, director of Landmark Properties.
“Markets such as Discovery Gardens and International City have witnessed the largest decline, while prime locations such as Downtown Dubai have witnessed the least.”
According to Michael, the reason prime markets have performed so well is predominately due to minimal supply.
Abu Dhabi’s real estate market continues to evolve as handovers take place in Marina Square and Sowwah Square. However, Landmark Advisory has noted that Dubai continues to have a negative effect on the Emirate’s assets.
“A decline of 3 per cent has been witnessed across Abu Dhabi’s apartment rents as Dubai still plays its damming part,” Michael said.
Michael confirmed capital values have declined slightly – 2 per cent – even though few transactions have taken place.
“Therefore, it is predicted that over the next 12 months people will be drawn back from Dubai as rent prices and values continue to fall,” he added.
In regards to Abu Dhabi’s commercial market, Landmark Advisory has witnessed a decline of 4.2 per cent in Grade A rents, with this decline expected to continue as more supply comes to the market.
“We predict that another 850,000 sq m will be delivered over the next two years,” Michael concluded. – TradeArabia News Service