Saturday, January 24, 2009

Dubai property prices slump 23%: HSBC

According to a new report by HSBC, property prices in Dubai have dropped 23% last month. For the first time, the survey measured the actual prices at which properties were purchased and sold.

The HSBC report for the last quarter of 2008 showed a 23% decline in property prices in Dubai, with villas showing considerable decrease in prices than apartments.

The once-booming property sector of the emirate has slowed down, owing to global economic turmoil, with the plunging prices and developers scaling back on their projects, and rising job layoffs.

Average prices for villas fell by 30 percent from their peak in September, but went up 33% year-on-year, while prices for apartments dropped 20% from last September, but grew 16% year-on-year.

The figures for December 2008 also indicate a drop of 23% from the peak in September 2008.

Transaction volumes fell from November 2008, but maintained healthy levels. The advertised rentals however, continued to increase 9% month-on-month, but HSBC expects rents to soften further with more units being converted from sale to lease.

The prices of properties in Dubai could drop by as much as 60% this year, from their peaks last year, Shuaa Capital predicts.

The latest report by Asteco, however, confirms that rental rates for villas and apartments have been levelling off throughout 2008 with an average growth rate of 4% for apartments and 8% for villas.


WebJunky said...

very true...recently a friend's parents bought a villa on the palm island. this villa was priced at 7m AED just few months back...they bought the place for under 4m AED. it will be interesting to see how far this dips...

< Ansar > said...

very sad