(MENAFN- Khaleej Times) Dubai's residential market, which ended 2013 on an upbeat note, is poised to witness further growth in rents and prices this year, but not at the rate of growth levels seen in 2013, a report by property consultants Jones Long LaSalle said on Sunday
In 2014, the residential market is expected to see a slowdown in the "unsustainable levels" of growth seen in 2013, JLL said
Property prices surge in Abu Dhab
Staff Repor
Securing top spot for the second consecutive quarter in 2013, Al Reem Island continues to be a hotbed for buyers, clocking up close to 30 per cent of the searches conducted on propertyfinder.ae, the UAE's leading property portal
Whilst prices of studios in the neighbourhood remained stable, those of one, two and three bedroom apartments increased by 14 per cent, 15 per cent and 6.6 per cent, respectively. ۬The findings are a result of ۬propertyfinder.ae's recently released Q4, 2013 report, which identified the top trending communities in the capital in terms of consumer search behaviour on the website
Placing second in the most searched communities list last quarter, Al Reef showed a more dramatic increase in property values with studios presenting a price rise of 38 per cent followed by one, two and three bedroom residences at 36 per cent, 34 per cent and 28 per cent, respectively. Al Raha Beach, on the other hand, grabbed third spot and showed bigger variations in price rises with those of studios standing at 31 per cent, one bedroom units at 15 per cent and two and three bedroom properties at 16 per cent and 20 per cent, respectively
"Abu Dhabi's real estate market surely showed signs of stabilisation and growth last year. The Expo 2020 site which is being developed in Jebel Ali, equidistant between the centres of Abu Dhabi and Dubai, is likely to benefit the Abu Dhabi market as well," said Renan M. Bourdeau, deputy CEO of propertyfinder.ae. rohma@khaleejtimes.co
In 2013, the residential market in Dubai ended with an increase in both rental values and sale prices across almost all areas. While prices increased 22 per cent year-on-year on average rents recorded a 17 per cent growth, JLL said in its 2013 fourth quarter Dubai Real Estate report
In 2013, the recovery has been broad-based and evident in prime as well as secondary and more affordable locations
Craig Plumb, the head of research at JLL, said the relatively broad-based recovery is likely to continue this year, with increases in average prices and rentals forecast in most sectors
Last year saw a definite improvement in sentiment and confidence towards the Dubai real estate market, culminating in the Expo 2020 win which provided a major boost in the final weeks of 2013, he said
"Sentiment and confidence are important drivers of the Dubai real estate market, but the underlying economic and demographic fundamentals have also improved in 2013," Plumb said
"The Dubai government has taken several measures to moderate the rapid increase in prices seen in 2013 and create more stable market conditions. These measures should help reduce some of the speculative pressures and reduce the likelihood of a significant price correction in 2014," he said
Overall, JLL said, 2013 saw the recovery of all sectors of the Dubai real estate market (residential, retail, hotel, industrial and offices). However, not all sectors performed similarly. "While the residential, retail, hotel and industrial sectors witnessed strong and relatively broad-based growth, the recovery of the office sector remains more selective and concentrated in a few prime locations, with high vacancies and significant new supply depressing rental pressure elsewhere," said the report
The real estate investment market in Dubai saw a limited number of transactions in the fourth quarter in 2013, as most sellers adopted a wait-and-see approach ahead of the results of the Expo 2020 bid, said JLL
The report noted that the main buyers in the Dubai market continue to be the Gulf Arabs with an increased interest in land. The office leasing market witnessed more activity in the fourth quarter, boosted by seasonal factors as many corporates acted ahead of year-end. "Prime rents continue to improve as the flight to quality continues to increase demand for the best quality space. Elsewhere, average office rents have remained unchanged with increases in some projects being offset by declines in others," said the report
The retail market registered growth in 2013, with turnover and rents increasing in both primary malls and community-based centres. Street shops have been also increasingly popular in select locations within Dubai in 2013. The hotel sector also had a very positive year with record tourist arrivals. Despite a number of notable openings, the market registered a remarkable 80 per cent occupancy rates and high average daily rates of $241
Dubai's industrial market also registered solid growth with a number of infrastructure projects benefiting the sector. "Demand continues to shift to newer areas to the south of Dubai, and this is expected to remain the case given the proximity of these areas to the Expo 2020 site," said the report
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