Press Trust of India / Dubai Apr 07, 2010, 12:21 IST
Average residential rent prices in Dubai saw a decline of over five per cent in the first quarter of the year, a real estate firm has said.
According to a research by local real estate firm Cluttons, the Dubai residential market has yet to reach its bottom in terms of pricing, despite declining roughly by 45 per cent in some areas since the peaks of 2008.
Cluttons report said that property sales were down by an average 2.9 per cent, adding that the glut of new homes coming online in Q2 would see rent prices dropping still further, added that the appetite for off-plan development had showed no signs of return.
"Although momentum has slowed, rents are expected to come down further over the second quarter due to the completion of new residential units," the report said. "The market now has a choice and quite naturally is veering towards quality product that offers a full lifestyle package," Steve Morgan, head of Cluttons UAE said.
"Going forward developers and investors alike can learn from this trend. If a development is to compete it must have a direction, a focus and a USP – and this doesn’t necessarily mean high-end luxury".
The real estate agent said Dubai villas were the most resilient to the decline in rental prices, falling four per cent, whereas the cost of renting an apartment dived by six per cent.
However, it said the prices for leasing residential property in Dubai have still not reached a bottom, despite declining around 45 per cent in some areas from their 2008 peak.
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