Sunday, July 2, 2017

Dubai residential prices fall 3.7pc in Q1

Dubai's residential property prices fell 3.69 per cent during the first quarter (Q1) of the year, an improvement from the price decline of 9.26 per cent a year earlier, a report said.

House prices fell 2.4 per cent during the latest quarter, added the Global Property Guide.

Dubai's property market has been one of the world's most volatile. Dubai saw one of the world's worst housing crashes from Q3 2008 to Q3 2011 with house prices plunging by 53 per cent. The market started to recover in 2012, with double-digit house price increases from Q2 2012 to Q4 2014. However, the property market began to slow in the second half of 2014, amidst housing oversupply, subdued demand and slower economic activity.

Demand is rising strongly again, another indication of improving housing market conditions. In Q1 2017, the value of real estate transactions soared by 45 per cent y-o-y to Dh77 billion ($20.96 billion), according to the Dubai Land Department.

UAE's economic growth slowed to 2.7 per cent in 2016, after GDP growth of 3.8 per cent in 2015, 3.1 per cent in 2014, 4.7 per cent in 2013, 7.1 per cent in 2012 and 4.9 per cent in 2011, according to the IMF.

Abu Dhabi is projected to expand by 3.7 per cent this year while Dubai will grow by 3.1 per cent. For the country as a whole, UAE is expected to see a GDP growth between 3.5 per cent and 4 per cent this year, based on government estimates.

Egypt was the weakest housing market in our global survey, with the nationwide real estate index falling by 16.68 per cent during the year to Q1 2017, worse than the annual decline of 9.49 per cent recorded in a year earlier. Quarter-on-quarter, house prices fell 7.61 per cent during the latest quarter.

In an effort to buoy the property market, President Abdel Fattah el-Sisi recently ratified Law 17/2015, removing the last remaining restrictions on foreign ownership of land and property in Egypt, and introduced rules allowing the government, the biggest landowner in Egypt, to contribute land to the private sector as part of public-private partnership schemes against a share of the revenue.

Egypt's economy grew by 4.3 per cent in 2016, the highest growth in 6 years, on the back of strong private consumption and investment in energy, real estate and infrastructure, according to BNP Paribas. The economy is expected to grow by 3.5 per cent this year and by another 4.5 per cent in 2018. – TradeArabia News Service

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