After two years of house price declines in Dubai, the UAE’s largest property data company recorded a slight uptick in prices last month.
According to new figures from the property data company Reid -in, house prices in Dubai increased by 1 per cent during the three months to the end of June, compared with the previous quarter.
Reidin, whose data is used by many of the big property brokers in the UAE, such as JLL and CBRE, said that average house prices in Dubai increased by 0.33 per cent last month compared with May.
It said sales prices remained flat when compared with data from six months ago, but prices were still 4 per cent lower than they had been a year earlier, and 12 per cent lower than they were during the market peak in 2014.
However, even though most property companies and brokers use the same data, they have been split over when to call the bottom of Dubai’s recent property cycle.
Last week property broker Luxhabitat crunched the Reidin figures for house sales in Dubai’s 10 most prime areas to calculate that the number of sales and the total value of sales doubled in the second quarter compared with the final three months of last year, which was the worst period of activity for the emirate’s property market since its previous peak two years ago.
“Recently, people seem to be more convinced that the next few months will be their optimum time to buy,” said Sally Ann Ghai, a luxury sales broker at Luxhabitat specialising in the Emirates Living area.
“Over the past two years we have seen a high amount of window shopping, with buyers delaying to pull the trigger on a purchase because of uncertainty over the potential for even cheaper buys if they hang on long enough.”
But other companies said the uptick was false and that mainstream Dubai house prices will continue to fall for many more months.
Yesterday MPM Properties, the property subsidiary of Abu Dhabi Islamic Bank, which uses its own data from thousands of mortgages, reported that house prices in Dubai remained flat as more than 4,000 new homes spread across 20 projects hit the market.
“With the launch of so many new units in Q2, there is no shortage of choice for buyers in Dubai,” said Paul Maisfield, the chief executive of MPM Properties. “But with more people seeking to get on to the property ladder to achieve long-term capital appreciation and relief from the vagaries of renting, the effect on prices is relatively neutral.”
JLL recently revised its forecast for the Dubai market revival from mid-this year to the start of next year, citing the UK’s vote to leave the European Union as the key reason for this six-month delay.
Meanwhile, another broker, Cluttons, said it expected a gradual softening of the Dubai market to occur for another six to 12 months.
Reidin also said housing rents in Dubai fell by 0.53 per cent last month compared with May, but remained flat over the previous quarter. It said rents in the city had fallen by 2 per cent compared with the same period six months ago, and 4 per cent compared with a year earlier.
Reidin said house prices in Abu Dhabi fell by 0.01 per cent last month, while rents fell by 0.59 per cent.
It said house prices in Abu Dhabi fell by 1 per cent during the three months to the end of June, while rents also fell by 1 per cent.
lbarnard@thenational.ae
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