Friday, December 14, 2018

Analysis of Dubai Real Estate


Dubai real estate market is always unpredictable as with larger price movements the response is more significant. In this essay we will analyse Dubai real estate market in terms of residential, offices and Industries. Dubai population as to this date stood 3.13 million with 7.2% year to year growth, also there is an increase in number of active registered companies this year by 4%.
Starting with residential properties 9% annual fall was recorded from last year and 2.9% quarterly decline was recorded in 2018 which equals 22.3% fall in yearly capital value. These capital value declines were registered in major areas of Dubai.
Offices rents were 11.6% lower than last year and a significant decrease in major areas were registered apart from Downtown Dubai where no change was recorded on quarterly basis.
Investors were attracted to ready properties. The average ticket price of which has increased by 9.5% quarterly. For ready villas the price stood at AED 10,333 per square meter which is decreased by 8.8% as compared to last year.
Average annual rents were AED 177000 and AED 255000 for 3 and 4 bed apartments respectively. Overall asking rents decreased to 11% from 2017.
Office prices overall were 24.7% lower than last year, Business Bay was the most preferred choice for office sales with 43% increase along with Jumeirah Lake Towers. Area sold during the year was recorded as 32,468 square meter.
On average office rent has declined by 11.8 % from last year. AED 948 per square meter was rent of normal office this year.
More than 1704 hotel rooms were added at the last quarter of the year in six hotels and it is expected that 2583 more rooms will be added to different hotels.
Industries has shown more growth in terms of sales with agreements to build more areas, Particularly by DP World. Indian pharmaceutical and bio technology opened a 10000 square meter manufacturing and research facility. Also Dubai Industrial Park launched some light weight industrial units.
Industrial rental rates on the other hand stood flat throughout the year with slight increase and decrease in various sectors.
Conclusion
We can say that 2017 was far better year for real estate market then 2018 because in almost all sectors there is a huge decline as compared to previous year, However, opinion of other people may be different from our opinion based on their research and conclusion.
Disclaimer
As mentioned earlier this document is purely based on our research. We do not accept any liability for any damage suffered by any party resulting from relying on this piece of information.
References
Huston, Simon, and Hoon Han. "Designing Transparent Real Estate Open Data Systems: Sydney, Dubai And London". SSRN Electronic Journal, 2018. Elsevier BV, doi:10.2139/ssrn.3113463.
Peng, Liang. "Benchmarking Local Commercial Real Estate Returns: Statistics Meets Economics". Real Estate Economics, 2018. Wiley, doi:10.1111/1540-6229.12229.

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