The last 12 months have been a period of softening prices and rents across most property types in Dubai, with significant declines in some areas.
In an end of year report, property site Bayut.com compiled a list of popular areas that had seen the most substantial declines year-on-year from November 2016 to December 2017.
This revealed that the average yearly rent in Dubai was decreasing, even in the most popular areas Dubai Marina, Dubai International City, Dubai Silicon Oasis, Mirdif and Bur Dubai.
In the second most popular rental location, Dubai International City, a 16 per cent decline in apartment rents was noted with the average rates for studios standing at Dhs31,000, one-beds Dhs42,000 and two-beds Dhs65,000.
Declines were also noted in Downtown Dubai, with rates roughly 5 per cent lower than last year. The average annual rent for a studio stood at Dhs75,000, a one-bed Dhs110,000 and a two-bed Dhs160,000.
Studio units in Mirdif were the only apartment type not to see a rental decline in 2017.
Changing apartment rental rates in Dubai’s most popular areas in 2017
In the villa rental market, Mirdif was also the most affordable community thanks in part to a 9-13 per cent drop in rents, with yearly rates of Dhs130,000 for three-beds, Dhs145,000 for four-beds and Dhs150,000 for five-beds.
The most expensive of the popular villas locations last year, the Palm Jumeirah, saw a similar 6-13 per cent decline with average rates standing at Dhs315,000 for a three-bed, Dhs420,000 for a four-bed and Dhs450,000 for a five-bed.
Changing villa rental rates in Dubai’s most popular areas in 2017
As a result of the falling rates, rental yields stood at 7 per cent and 5 per cent for apartments and villas in the emirate respectively, according to the company.
Similarly in the sales market there were notable price declines but they were less substantial than those seen for rents.
Dubai Marina was the most attractive community for apartment buyers, followed by Downtown Dubai, Jumeirah Village Circle, Jumeirah Lake Towers and the Palm Jumeirah.
The cheapest location was similarly to rents, International City, where studios, one-beds and two-beds could be acquired for Dhs350,000, Dhs475,000 and Dhs850,000 respectively after a roughly 5 per cent decline in prices.
In the most expensive area, the Palm Jumeirah, prices for studios declined 1.9 per cent to Dhs1.25m, one-beds increased 5.2 per cent to Dhs2.4m and two-beds decreased 1.8 per cent to Dhs2.7m.
Apartment price increases were also seen fro studios in Dubai Silicon Oasis and Dubai Sports City (up almost 1 per cent) and for two-beds in Jumeirah Lake Towers (up 0.5 per cent).
Changing apartment sales prices in Dubai’s most popular areas in 2017
For villas the most popular communities were Arabian Ranches, Reem Community, Dubailand, the Palm Jumeirah and The Springs. Prices were found to be unchanged or falling in most locations with the exception of Reem Community where a substantial 10 per cent increase was noted as more properties in the area were completed and handed over and its desirability increased.
Prices were found to be lowest in Dubailand where the cost of the average three-bed was unchanged at Dhs1.6m. Four- and five-bed prices dipped 8-13 per cent to Dhs2.8m and Dhs3.6m respectively.
In the most expensive of the popular areas, Palm Jumeirah, prices declined 4-9 per cent to stand at Dhs8m for a three-bed villa, Dhs11.5m for a four-bed and Dhs15.5m for a five-bed.
Changing villa sales prices in Dubai’s most popular areas in 2017
Finally, in the off-plan market Bayut said 86 per cent of its listings for the UAE were Dubai-based, proving the popularity of projects and the variety of payment plans available.
Off-plan listings were most popular in Dubai Marina, followed by Downtown, Jumeirah Village Circle, Jumeirah Lake Towers and Dubai Silicon Oasis.
The highest number of site views for Dubai Marina came from Marina Gate 1, with nearly 70 per cent. In Downtown, the most popular was Emaar’s Vida Residences with 15 per cent of area views, while in Jumeirah Village Circle Bloom Towers and Green Valley Towers had 28 per cent of views respectively.
Other popular off-plan listings were Wind Tower 1 and Wind Tower II in Jumeirah Lake Towers with more than 15 per cent of views each and Binghatti Stars with 55 per cent of views in Dubai Silicon Oasis.
“As more and more off-plan projects are completed in 2018, handed over and put on the secondary market, we can expect prices continuing to attract investors while landlords will have to stay competitive to entice potential tenants,” said Bayut.com CEO Haider Ali Khan.
“In the long run, as the marketand the broader economy move on a trajectory of diversification and maturity, the opportunity for developers and sellers to capitalise on their investment remains strong.”