Saturday, December 23, 2006

Villa units in Dubai to rise to 240,000 by the year 2010

According to Colliers International, Real Estate Consultancy, Dubai currently holds approximately 16,500 villa units and 110,000 apartments and it is further estimated that about 170,000 to 240,000 units will be brought about by the year 2010.

Colliers predicts a softening of rentals and a potential decline in occupancy as against the high level occupancy of more than 99 percent that is taking place currently. As per reports, Colliers project that as the rents soften, and as the supply increases, the market will witness a change from the shared accommodation that is happening currently to single occupier units.

According to the firm, when the space available is tallied with the population growth, it is clearly evident that there is a yearly demand for single family units of atleast six percent since the year 2000. In case an alteration in the relationship between demand and supply arises, it is expected to have a significant impact on the high income category.

Another forecast made by Colliers is the change of payment structures. According to the firm, the trend witnessed by the market wherein there is a partial transition from annually paid rent advance to quarterly rent advance is likely to continue. The report also adds that the residential development market in Dubai has shown a spectacular capital increase on resale. There is a continuous rise in price inflation in the secondary market as per reports.

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