Dubai Property Prices shows an Interesting Trend

Dubizzle, the leading property classifieds website in MENA, reports the latest UAE and Dubai real estate property trends in its Q2 2015 report. The report includes insight on how real estate property prices are changing in Dubai Marina, Old Dubai, and other highly preferred areas.

The report reveals that Dubai Marina, being in a very desirable location, is still the most sought-after Dubai real estate location, with over 4.9 million searches between April and June this year. For two consecutive quarters, Dubai Marina holds the top spot among other communities in Dubai, with over 20 million searches made in Q2 2015. Properties in Dubai Marina went down by 18% and 14% for studio units and three-bedroom apartments, respectively.

Palm Jumeirah, another primed real estate location Dubai, saw a change in property prices for both studio units and two-bedroom apartments, increasing from 1.45 million to 1.54 million and 3.2 million to 3.35 million respectively.
Meanwhile, Deira also had price increases due to high Dubai real estate demand and no new supply. This became a factor in making prices in old Dubai align with newer communities across the city. The rental price tag of a studio unit in Deira increased by 18%, while those in Bur Dubai rose from 60K to 65K, and three bedroom apartments changed from 150K to 158K.

When asked about the matter, Dubizzle’s Product Marketing Manager Ms. Ann Boothello said: “The Dubai property market is softening as per the price changes experienced in Q2 this year. Some areas have experienced while older areas in Dubai showed price increases in reflection to a maintained level of demand for these older units and the alignment of their prices with those in newer areas in Dubai. An example of this is that now a studio in Bur Dubai is rented out for AED 65,000 annually and in Dubai Marina at AED 70,000.”

“Prices of properties for sale decreased across Dubai, with the exception of studios and 2 BR apartments on the Palm Jumeirah increasing up to 6%. Abu Dhabi on the other hand, experienced price increases in for sale and rent properties; however Al Reem Island saw a drop in prices for 1, 2, and 3 bedroom apartments.”

RP Global inks Management Agreement with Jumeirah Group for new Dubai real estate Luxury Property

Jumeirah Group was chosen has recently been appointed by RP Global to operate a mixed-use development found in RP Global’s latest real estate in Dubai: a US$1 billion iconic tower, which will be the 2^nd tallest structure in Dubai.

The deal was signed by Dr. Ravi Pillai, Chairman of RP Global’s parent company RP Group of Companies, and Mr. Gerald Lawless, President and Group CEO of the Jumeirah Group. The signing ceremony was held at Jumeirah Group’s flagship property, the Burj Al Arab.

When asked about what he can say about the new management agreement, Mr. Gerald Lawless said: “RP Global is a company committed to excellence, and we look forward to working together and operating this outstanding property. Jumeirah has a reputation for luxury and exceptional hospitality, and our partnership reflects the strong synergies between Jumeirah Group and RP Global. As Dubai moves towards its tourism vision of receiving 20 million visitors a year by 2020, we are proud to be strengthening our Jumeirah portfolio in Dubai.”

 “We are investing close to US$1 billion of our own resources into Dubai’s real estate sector to develop a world-class tower that will be operated by the esteemed luxury hospitality brand, Jumeirah Group. RP Global is committed to superior quality and timely delivery and like the Jumeirah Group, we strive to create well designed, innovative lifestyle concepts for our buyers. Dubai’s resident population is growing rapidly and we are looking forward to adding an iconic tower to Dubai’s skyline in partnership with Jumeirah”, said Dr. Ravi Pillai about the management agreement.

The super-tall tower, once finished, will have a total area of over 3 million square feet, and promises to offer breathtaking views of Downtown Dubai and Burj Khalifa. Designed to be a luxury urban resort destination, the tower will have an smorgasbord of food and beverage outlets, conference and banquet facilities, an award-winning Talise Spa and Health Club, and a lively open-air roof top Sky bar. This Dubai real estate property will be situated in the heart of Business Bay, just behind the Dubai Metro station and parallel to Sheikh Zayed Road.

The tower will boast exciting features, especially its thrilling sky attractions, giving a dynamic interactive experience with views for its visitors high above buildings around Business Bay. The tower is designed by Atkins Global, the same world-renowned designing and engineering firm responsible for the world-famous Burj Al Arab Jumeirah. The tower is expected to be completed just before the opening of Expo 2020.

The Jumeirah Group currently operates 23 hotels all over Europe, the Middle East, and Asia. 25 other property plans are in the pipeline both for the company’s Jumeirah and Venu property brands.

RP Global is the real estate development company of RP Group of Companies. Established by Dr. Ravi Pillai, RP Group of Companies have operations in 20 cities across 9 countries. They have undertaken projects worth over USD$25 billion globally, and has a wide range of investments in hospitality, construction & industrial development, healthcare & wellness, education & trading, and operates in Middle East, Africa, Australia, and Asia.

Dubai Real Estate is Growing Up

Since 2008, the Dubai real estate has gone a long way from crashing due to the global recession that mightily affected the region. Now, the real estate in Dubai is flourishing and it’s brighter than ever.

The sudden growth has led developers to churn out many projects left and right. In effect, there have been increases in regulations made by the government in order to increase the amount of stability in the market. These regulations coupled with a number of economic factors have slowed down the real estate sector, although for a minimal mark. Is this a sign of a maturing market?

Typically there are many definitions of what may defined as a mature market, but a few key identifiers could be described as follows, according to Andrew Chambers, CEO of GGICO Properties and long time real estate veteran.

INCREASED REGULATIONS
-    Increased regulations aimed to reduce unscrupulous transactions.

MORE NEGOTIATIONS
-    Due to the high prices of units being sold, more buyers are asking for a bargain from sellers.

STABILIZING MARKET PRICES
-    With a steady, measured, and considered growth, a planned release of products will help stabilize the market. The market remains a little oversupplied at the luxury end and the impact of lower oil prices and stronger dollar will undoubtedly dampen the demand from overseas investors.

BROKERAGE MARKET
-    Less rogue agents and slowing down the amount of players in the market will be good for market confidence and stability.

AFFORDABILITY
-    This is now starting to be addressed by some developers in areas such as SO and DSC, where more mid level property, with good payment plans allowing people to buy to occupy.

CLEARANCE FROM BANKS BOOKS OF TOXIC/PROBLEM STOCK
-    The past 5 years has seen banks stuck with many non-performing or incomplete properties in default. This is not good for a stable property market. This seems to be resolved now, with many projects restarted with adequate finance and good business plan to see the construction to completion.

SUMMARY
Whilst there is some way to go for Dubai to be recognized as what the world sees as a Mature Market, Dubai has well survived turbulent times and a number of the issues raised here either resolved or in the process of being resolved. Nevertheless, it is still important to keep Dubai as being seen as a robust and very positive market position in the World’s eyes.