AVERAGE home prices in Dubai fell by almost 10 percent in 2015, but residential property in the Middle East country remains a good investment, according to global consulting firm Deloitte.
Dubai is home to hundreds of thousands of Filipinos overseas.
In its Real Estate Predictions 2016 for Dubai, Deloitte said average residential sale prices across the country fell by 9.5 percent in 2015.
But it stressed that real estate performance in Dubai continues to be among the top global cities, when taking a longer-term investment view.
“We see positive market fundamentals for Dubai in 2016, including infrastructure investment and connectivity, offering potentially good prospects in the real estate market for well specified developments,” it said. “Following a significant number of project launches during 2015, contributing to a strong residential pipeline for Dubai, we predict that the focus in 2016 will turn to project delivery.”
It said while published pipeline forecasts estimate that some 40,000 residential units would be delivered in 2016, consultations with key developers suggest that a more realistic number would be just about 10,000 units.
“We predict that average residential sale prices will decrease further in 2016, reflecting a transition to a more mature market, as well as an increase in more affordable stock and discounting in emerging locations,” Deloitte said. “We foresee that developers with limited track-records in delivering residential projects in Dubai will increasingly compete for sales, with payment
plans weighted towards handover and beyond. We predict that while there may be a softening in residential rental prices in some submarkets, we do not anticipate that this will be to the same degree of recent declines in residential sales prices. We consider that rental price decline could be exacerbated further if speculative investors, who are unable to sell product for a satisfactory return, instead decide to release units for rent.”