- Exclusive report by UAE’s leading property search portal shows more than half of UAE online viewings are for properties renting for less than 100,000 per annum
- Yet the affordable housing segment, particularly low-priced villas, remains under-supplied and prices have increased, bucking broader market trends
- Dubai’s Discovery Gardens provides best yield in UAE at more than 10 percent, despite big drop in rental values this year
- Propertyfinder research shows big differences between advertised prices and the price prospective buyers and tenants would pay
- The report is available for free download at propertyfinder.ae
Dubai, 20th November: Propertyfinder Group’s inaugural UAE Real Estate Trends report shows a continued undersupply of affordable villas in Dubai is pushing up prices in this segment, enabling it to outperform a broadly lackluster market that remains pressured by low oil prices and sluggish economic activity in the Gulf.
These gains may be positive for investors but will not be welcomed by residents struggling to find somewhere affordable to live in Dubai, which is among the 10 most expensive cities globally.
“The affordable villa segment in both sale and rent actually showed signs of growth, indicating there continues to be undersupply,” states the report, which is available for free download at www.propertyfinder.ae and covers Dubai, Abu Dhabi and the Northern Emirates.
Analysis of the portal’s traffic, which represents 55 percent of online searches for property to rent or buy in the UAE, shows over half of Dubai online rental viewings are for homes advertised at 100,000 dirhams per year or less, yet properties within this range account for only a quarter of listings.
propertyfinder’s chief operating officer Paul Stewart-Smith says: “With developers now being able to look into market trends and searches with more granularity and certainty, we expect to see more affordable and relevant housing being built.
“The compromise now lays on the location as these affordable communities are being built on Emirates Road; the distance to work, an evening out or at the beach becomes that little bit further and the “attractiveness” of living in Dubai somewhat compromised.”
The report reveals some contrasting trends – anemic regional economic growth and increased competition among developers has pressured prices, particularly in Dubai’s “emerging” communities, yet some of these neighbourhoods still provide world-class yields.
For example, Discovery Gardens was giving an August yield of 10.4 percent – the highest in the UAE – despite advertised rents plunging 18.3 percent in 2016. The luxurious villa district Emirates Hills, in contrast, delivered a yield of just 3 percent, the lowest in Dubai.
High-end communities in both Dubai and Abu Dhabi have proved resilient this year with modest single digit declines in their median advertised sales and rental prices in 2016, propertyfinder data shows.
“We’ve seen property seekers shifting towards data-driven decisions when it comes to buying or renting: they map-out the whole market and communities before deciding where to rent or invest,” says Paul Spargo, propertyfinder.ae Commercial Director.
“We aim to streamline the journey by giving, in addition to quality listings, the data needed for making the fastest decision when it comes to buying or renting, prices and trends, nearby amenities, school finder, property ranking, etcetera.”
In Dubai, differences between what potential renters and buyers would pay and the asking price of landlords and sellers varies enormously by district.
Would-be buyers in Dubai Marina and JLT, which along with Downtown Dubai are the most-viewed communities for apartments, want discounts of 20 and 32 percent respectively on the advertised price, indicating price pressures will persist. Yet in Downtown, prospective buyers would pay above the asking price.
© Press Release 2016
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