The rentals in the majority of the apartments sector across prime areas in Dubai, UAE, did not witness any change in the fourth quarter of 2015, according to a property expert.

However, locations such as Jumeirah Park observed a slight rental decrease of three per cent, while the islands and golf estates witnessed a two per cent decline, stated leading international property agency Chestertons.

The villa segment too saw a decrease of one per cent in rental price in Q4 last year as compared to the previous quarter, said the expert in its Middle East and North Africa (Mena) Observer report.

Commenting on the report, Declan McNaughton, the managing director, Chestertons UAE, said: "The residential prices dropped in the last quarter and that has made the yields attractive. Apartments provided higher average yield than villas. International City and Discovery Gardens were the highest yield providers in apartments."

According to him, the villa segment provided a five per cent yield as the market witnessed a decline in both the rental and sales prices.

"Mudon, The Springs and Victory Heights were a cut above the average yield. However, we expect the market to remain sluggish during the first quarter of 2016 due to a combination of factors including lower oil prices, dollar appreciation and regional economic uncertainties," observed McNaughton.

The property expert said Springs and Meadows were the top traded destinations with transactions worth over Dh940 million ($256 million).

The apartments sector accounted for 64 per cent of the transactions in the fourth quarter. Mortgages during the same period had dropped by 43 per cent indicating the fact that the end-users demand for residential properties is slowing down.

McNaughton pointed out that the property prices have corrected significantly over the last year with attractive bargains in some locations.

"With high rentals, this is an apt time to lock a property that will bring good yields. There is a general consensus in the industry that the market will remain subdued during 2016," he stated.

"However, this phase could provide good investment opportunities for the long term. Also, this phase will not stay there for long as we move closer to Expo 2020. This is an ideal market for both end-users and long-term property investors," observed McNaughton.

Robin Teh, the country manager (UAE), said Dubai market was expected to add another 3,000 units during this year. "However, imbalance in the supply and demand situation will continue to build pressure on property prices across the emirate. We expect the sale prices to correct further during the year," he noted.

According to him, the total number of transactions for the fourth quarter of 2015 fell 44 per cent to Dh24.3 billion ($6.6 billion) from the previous quarter's value of Dh33.1 billion ($9 billion).

The sales transactions for the fourth quarter of 2015 amounted to Dh12.7 billion ($3.45 billion) and had a marginal decline of one per cent compared to the third quarter of 2015, stated Teh.

According to him, last year an estimated 15,000 units were delivered in Dubai. "We are likely to see a similar number being delivered over the next three years, following which supply may reduce significantly. Master developers could alter the construction and delivery cycle accordingly and this could keep the supply figures under control," he added.-TradeArabia News Service