Thursday, September 15, 2011

Dubai among world’s worst performing realty markets

A new global property report has rated Dubai as being one of the worst performing realty markets in the world, although the rate of prices are slowing down.

The real estate market in Dubai has witnessed a 64percent decline in prices in certain location, and was recorded as the ninth worst performing markets in the world last year, said the Global House Price Index from Knight Frank. Being one of the worst performing real estate markets in the Gulf over the past three years, the rents and prices have more than halved from their peak in 2008, although residential costs have further to go, analysts said.

The survey, which included 50 biggest property markets in the world, named Ireland as the worst performing realty market, with 12.9percent decline in housing prices within a span of twelve months to June 2011. Dubai recorded a 4.7percent decline. Oversupply continued to be the major reason for fall in rentals and prices.

Another 13,000 new units are likely to hit the market by the end of this year, followed by 27,000 properties in 2012, says a Colliers report. In the month of June along, Dubai has cancelled 217 real estate projects, following review of more than 450 projects. Another 237 developments are likely to be completed in due course, it is said. However, an analysis based on first half of this year, showed that the prices have slowly improved, and grew 0.1percent between January 2011 and June 2011.

 Asia continued to be the top performing continent in terms of house price inflation, maintaining its position which it held for seven consecutive quarters, the report said. The survey also indicated that rate of decline in Dubai has begun to slow down.

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