Prime Market in Dubai is Cheaper Now Than in Any Other Major City

Dubai Property
Prime Market in Dubai is Cheaper Now Than in Any Other Major City

Dubai’s luxury property market has reached its lows and now offers a great value for money.

According to Core Savills report “DUBAI INVESTMENT OUTLOOK: Opportunities and Risks 2018”, Dubai luxury property market is demonstrating lower prices than most prime locations in the world.

As many other countries in the world, Dubai was hit quite hard during the global economic downturn, when the property prices in the emirate fell between 50% and 70%. Consequently, those who had invested in the property market prior to the crash in 2007, were hit hardest.

In addition, the collapse of oil prices in 2014 affected wealth in the region and scared off potential investors. Since that prime property prices in Dubai have been falling.

However, there are some indications that the property market in Dubai has hit the bottom of its downslide and is balancing itself out, thanks to cheaper mortgage interest rates which are under 5% now, and also less expensive mortgage arrangements fees.

The government and those who have already invested in Dubai have big hopes for the World Expo 2020 which will take place in Dubai. There are some mega infrastructure projects linked to the event which will hopefully lift market sentiment, boost Dubai economic development and increase the region’s attraction for expat investors.

Even depressed, for those investors who pursue rental yields, Dubai still has what it takes.

Although yields in Dubai have fallen from 9% to as low as 5.6% in the luxury apartment market, residential rental yields in some areas (Dubai Marina, for example) are still higher than other global investment destinations such as Manhattan, London and Singapore.

Moreover, the report forecasts that the rental yields will stabilise soon.

“Prices expected to continue stabilising in the prime and upper mid-market segment while the current decline in rents is anticipated to decelerate, allowing yield compression to slow down.”

Read the full story in Arabian Business