A topic of keen interest to many clients and potential investors is, how is Dubai’s real estate market performing.
Whilst Dubai is often considered the benchmark for many industries in the region, it’s also important not to compare Dubai directly to the performance of other major cities and countries in the Middle East.
Before forecasting the performance of Dubai’s real estate market in 2019, it’s important to review previous years’ performance to gain a more accurate understanding.
Property prices fluctuated significantly between 2015 and 2016 with sales prices dropping by around 5.6% whilst average rents reduced by approximately 7%. Since then the market has been recovering month on month to become more stable to aid both buyers and renters of property.
Here’s a summary of key factors which have affected the market in Dubai in recent years.
1). Mortgage Cap Introduced
To protect the market, the UAE Government implemented new legislation requiring Emiratis to pay 20% in down payments with expats and other foreign investors requiring 25%.
2). Supply and Demand
Real Estate developers have often sought to focus on high-end developments which to many isolated a big portion of the market. Once the demand of luxury properties dropped, the developers were left with many unsold units. Focus has now turned to more affordable properties to reach a bigger portion of the market.
3). A Strong Currency (AED)
The Emirati Dirham has gained in strength in recent years meaning squeezing investor from China, India and the UK out of the market.
To summarise, the Dubai market is affected positively or negatively by internal factors as opposed to regional activity.
To learn more about the Bahrain market, our expert team are on-hand, well informed and ready to take your calls. Contact 38000002 or email [email protected] to find out more!