'Light at end of the tunnel for Dubai property' - but prices still fall

New data shows residential prices in Dubai stablising in some neighbourhoods, while other areas continue to decline.

Overall prices for apartments declined seven per cent since the start of the year, according to research released today by Jones Lang LaSalle. And villa values declined by six per cent in the quarter, JLL reports.

"Although there are pockets of stabilisation within Dubai's high end residential sector, the overall residential market will continue to experience a situation of oversupply and prices are expected to decline further over the remainder of 2011," JLL reports.

But there are some positive signs in the market, with new research from Cluttons showing prices in some neighbourhoods flattening out.

"I think there is light at the end of the tunnel, but it is still a long way off and still project specific," said Steve Morgan, head of Cluttons' UAE office.

High end villas are performing better than the overall market, according to Cluttons latest data. Prices for villas in developments as Arabian Ranches, Meadows and Palm Jumeirah have posted "little to no movement over the last three months, which bodes well for the recovery", Cluttons reported.

Other villa developments such as Victory Heights and Motor City reported drops of 3.6 per cent from the end of 2010, according to Cluttons.

"In a broad based terms the falls we've seen in the previous quarters are leveling off," said Mr Morgan.

But there's a different story in apartments, where an oversupply continues to drive down prices.

In less expensive apartment developments such as Discovery Gardens and International City, prices declined 8.9 per cent in the quarter, according to Cluttons. But prices in such higher end apartment towers in Dubai Marina, Old Town and Palm Jumeirah fell only 3.7 per cent in the quarter, according to Cluttons.

The over supply situation in apartments is likely to continue for at least a year, analysts say.

More than 25,000 units are expected to come on line in 2011, Jones Lang LaSalle (JLL) forecasts. About 7,900 units were completed in the first quarter of 2011, JLL reports.

By the end of 2011, apartments will represent 79 of the residential stock in Dubai, JLL reports.

Part of the movement in the market is a "flight to quality," as buyers take advantage of low prices to upgrade for lower end neighbourhoods.

Who has lived at The Bishops Avenue?

George Sainsbury of the supermarket dynasty, sugar magnate William Park Lyle and actress Dame Gracie Fields were residents in the 1930s when the street was only known as ‘Millionaires’ Row’.
Then came the international super rich, including the last king of Greece, Constantine II, the Sultan of Brunei and Indian steel magnate Lakshmi Mittal who was at one point ranked the third richest person in the world.
Turkish tycoon Halis Torprak sold his mansion for £50m in 2008 after spending just two days there. The House of Saud sold 10 properties on the road in 2013 for almost £80m.
Other residents have included Iraqi businessman Nemir Kirdar, singer Ariana Grande, holiday camp impresario Sir Billy Butlin, businessman Asil Nadir, Paul McCartney’s former wife Heather Mills.

Hunting park to luxury living

Land was originally the Bishop of London's hunting park, hence the name
The road was laid out in the mid 19th Century, meandering through woodland and farmland
Its earliest houses at the turn of the 20th Century were substantial detached properties with extensive grounds

'Light at end of the tunnel for Dubai property' - but prices still fall

Dubai house prices continue to fall, but there are some positive signs, new data shows - with video.

Who has lived at The Bishops Avenue?

Hunting park to luxury living