Even before it was built, the Burj Khalifa served as a barometer of the health of Dubai’s fast-changing property market.
Launched as a project in July 2006 as a flashy marker of Dubai’s ambitions to become a leading global city, prices grew almost as quickly as the building work. By the second quarter of 2008, prices had swelled 44 per cent from the earlier quarter.
Then the onset of the property downturn sent prices sinking from a peak of Dh9,000 per square foot in August 2008 to Dh2,500 by February 2009.
But as the fourth anniversary of the building's completion approaches on January 4, prices have perked up again, mirroring gains in the wider market.
“Looking back at market data prior to the economic downturn, there have been fluctuations in apartment values at the Burj Khalifa each quarter since its launch,” said Steve Morgan, the head of Cluttons Middle East, an independent partnership of chartered surveyors.
“In 2013, prices for apartments in the tower have risen by 25 per cent, which has been supported in part by continued optimism surrounding Dubai’s economic buoyancy and also by ongoing growth in investor interest in our city’s real estate market.”
Prices now stand at Dh3,750 per square foot, a 50 per cent rise from the level of February 2009, said Cluttons. It means since off plan residential units were first sold for the development in July 2006, overall values have risen by 87.5 per cent.
“Residential value performance in the Burj Khalifa mirrors the performance of Dubai’s broader residential landscape,” said Mr Morgan.
After crashing by as much as 60 per cent during the global financial crisis then bottoming out and starting to rise again last year, Dubai house prices surged during 2013. Residential sales prices were up 24.5 per cent last month from their year earlier value, according to data released yesterday by Reidin.com.
But even with the rise, average values remain below the level of the Burj Khalifa, one of the most exclusive residences. Across Dubai, average property prices stood at Dh1,359 per square foot, according to Cluttons.
The IMF has been among observers cautioning about the risk of the inflation of a price bubble in the property market as investors and liquidity have returned to the economy.
But Cluttons said the scale of the recovery, both in the Burj Khalifa and wider emirate, indicated “sustainable growth”.
tarnold@thenational.ae
