April 5th, 2017 by Own A Space
Whether you are planning to move home with the objective of capitalizing on cheaper rents or you are simply looking to buy a home in Dubai, your wait has ended. Dubai rates for sales and rents are slowing and it is expected that the market will hit the low before the end of this year.
An average residential price is moderated in the first quarter of this year by 0.9%, according to a real estate consultancy. With Burj Khalifa apartments leading, luxury property is witnessing substantial decrease in the prices. A correction 25% value over the past 12 months and -6.9% in this year’s first quarter has been witnessed.
Top 4 weakest performing markets since last one year are Hattan Villas at lakes and Arabian ranches, Palm Jumeirah villas and apartments. Right now, the residential prices of Dubai is at 28.7% cheaper than it was in 3rd quarter of 2008.
The reason for decrease is due to increase in the availability of homes and more constrained demand. Large units feel the pressure of the price more. Landlords have become more flexible with rent and tenants are negotiating.
While local economic drivers might look strong, regional and global economic ambiguity has cut back the domestic growth. Irrespective of this, the off plan residential sales market has remained flexible and accounts for 53% of all deals last year. This has been aided by some favorable payment methods which are applied beyond handover.
Future supply levels in Dubai will keep on increasing as developers make a coordinated push in Expo 2020. This is pushing annual deliveries above 5 years on average, expecting that the number will keep on rising in short to medium term when the new plan comes. Dubai’s average rent value dropped 9.9 per cent last year.
Picture Courtesy: allhdwallpapers.com
Creation rate of senior level executive positions has droppedand is reflected up on the lower level of enquiries and budgets. Planned introduction of VAT on January 1, 2018 is causing nervousness in Dubai office market, among existing tenants.
Many international occupiers will be able to take their stride, assumed that they are well aware of the taxation regimes in their own home markets. Although, for UK’s international occupiers, or from Europe’s, the prospect of 5% tax on rental payments, mixed with high operational costs due to strong US dollar, might dampen the take up activity in short or medium term.
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