Thursday, November 05, 2009

Dubai houses record 7 percent rise in prices during Q3 2009

Prices of housing units in Dubai saw an increase for the first time during the third quarter, following the major downturn faced by property market in the wake of credit crunch, reports Colliers International, the leading real estate consultancy.

Dubai, which houses the tallest buildings and man-made islands in the world, saw its property market hitting the bottom, with finance drying up, construction activities almost coming to a halt, and several projects being cancelled or delayed.

Colliers, in its third quarter report, mentioned that the house prices marked a 7 percent rise during the period, compared to that of the previous quarter, the first-ever increase after third quarter of 2008.

According to Colliers, the increase was largely due to availability of mortgage and more confidence about expatriate job security.

A statement by Colliers International said that the Q3 results indicates a bounce in the market, but the Q4 results should be waited and watched before predicting the existence of a growth profile or potential recovery.

The prices for villas, apartments and townhouses showed a modest increase during the quarter, compared to the second quarter when there was an increase in the number of deals also. Even market transactions during the third quarter showed a 64 percent increase over the second quarter, with apartments making up for majority of deals.

The Colliers index is mainly based on mortgage data from local and international lenders. It measures prices in the parts of Dubai where foreigners have been granted permission to purchase properties, ever-since Dubai opened its real estate market to foreigners in 2002. These areas were largely responsible for the Dubai real estate boom.

The improved condition in Dubai's real estate sector are inline with a nascent recovery in a more mature global property market, such as United States and Britain, the report said.

According to a Reuters poll in October, the prices will drop another 10 percent this year. Colliers however, reported a 47 percent drop year-on-year during third quarter.

The prices of housing had witnessed a 9 percent drop in the second quarter, but the pace of decline had slowed thereafter. The boost in the third quarter helped in bringing back the prices to levels last seen in second quarter of 2007, the Colliers report said.


Dubai Property said...

Dubai property prices is declining but with a low pace. When it would come to its stable situation?

Maria Joe said...

well that is a very good NEWS for the property investor's point of view as investors were going out because of recent inflation in the Dubai property market.