Dubai’s property market is slowly stabilising against the bloated market last year. Apartment and villa sales prices were down 2 percent and 3 percent in the fourth quarter of 2019, compared to the previous year, a local media report said.
That said, residential property prices have hit a record high this year, exerting more pressure on market prices and rentals. According to real estate research firms, 50,000 units will come up in Dubai this year. This turn is anticipated to slow down the market in 2020.
One factor that will contribute to the rise in short term rentals and holiday homes market is the five-year tourism visa for all nationalities, the media reports said.
Dubai’s rental market witnessed no movement in the fourth quarter despite a draft law aimed to fix rental rates for three years since the signing of a contract.
Chris Hobden, associate director of Chestertons MENA, told Arab News, “The Dubai residential market in Q4 2019 is alluding to a more positive outlook for 2020 thanks to the slowdown of sales price declines and the leveling of rental rates. This does, however, have to be tempered by the volume of new units scheduled for delivery in 2020, which makes the short-term recovery of prices in the emirate unlikely.”
The average year-on-year sales price drop was more than 8 percent and rental drop is more than 9 percent in 2020.
For this year, landlords are expected to be more realistic to ensure high occupancy. Other benefits offered to tenants such as rent-free periods, multiple cheques and short-term leases will continue, Hobden said.