Apartment and villa rents in Dubai climbed an average 17 percent last year as the Persian Gulf business hub benefits from the euro-zone crisis and the so-called Arab Spring, according to Asteco Property Management.
“Mid to high budget enquiries have increased and stock in popular developments is drying up,” Asteco said in an e-mailed statement today. “In terms of supply and demand, Dubai is still benefiting from the euro crisis and the Arab Spring as people seek stability and better economic conditions.”
Dubai, which witnessed one of the world’s worst property crashes with a 65 percent drop in home values from its 2008 peak, is returning to large projects that dominated the market. The emirate, home to the world’s tallest tower and man-made islands, in November announced plans to develop a new district with the world’s largest mall, 100 hotels and gardens larger than London’s Hyde Park.
The highest rental growth for residential villas was in the Springs area, while those for apartments in Discovery Gardens, Asteco said. Prices in the commercial property market saw “little movement” during last year, according to the statement.
“If demand continues, we expect to see a shift in the market from being predominantly tenant-led to one controlled by landlords, especially in quality, well-managed and established developments,” Managing Director John Stevens said in the statement.
Sale Prices Rise
Villa sale prices climbed an average 23 percent year-on-year and apartment prices gained 14 percent, according to Asteco. “The buyer profile was dominated by self-use and investments for rental income, with expatriates taking a longer-term view of living in Dubai.”
Foreigners make up more than 80 percent of the population of the U.A.E., which includes Dubai and Abu Dhabi, according to government estimates. Dubai first allowed expatriates to own property in 2002, which sparked a real estate boom attracting investors from India, Iran, Pakistan and Russia.