Property experts stated that over the next 12 months, the real estate sector of the United Arab Emirates is likely to stabilize after facing headwinds during the initial half of 2019 due to a series government initiatives targeted to boost the sentiment & drive demand.
A research associate at JLL Mena, Dana Salbak stated that the overall market sentiment should improve shortly with the announcement of incitements such as the new visa regulations. Whereas the benefits of these initiatives are not expected to have an immediate impact, we do anticipate some sectors of the real estate industry to take this initial effort to the execution level up to 2020.
He added that, while the residential sector in, both, Dubai & Abu Dhabi witnessed performance overall, novel initiatives to drive expatriate homeownership will probably boost the demand. The office sector, as well, will see potential upside from these novel initiatives launched to stimulate the economy.
While the rents & average sale prices softened across the majority of the communities in Dubai in Q2 over the period of 12 months from the 2nd quarter of 2018, the average rate of price decline has decelerated, Cavendish Maxwell’s United Arab Emirates Property Market Report stated that on average apartment prices declined 15.1% and townhouse/villa prices declined by 14.7% in Q2 2019 from a year ago. During the same period, rental declines for apartments in Dubai averaged 12.5 percent and townhouse/villa in the same way registered a fall of 12.6%.
The Cavendish Maxwell report further stated that off-plan transfers continued to dominate in the second quarter of 2019, accounting for over 52% of total transfers. In Abu Dhabi, average sales prices declined by 12.6% for apartments in key investment zones, from the second quarter of 2018 to the second quarter of 2019. townhouse/villa prices registered a similar average decline of 12.1% over the same period.