Dubai property prices are now at levels not seen since late 2012 and early 2013 following an 18-month slide in values, according to listings site PropertyFinder.
In a report, the company said median property sales prices in the emirate fell 20 per cent from November 2015 to April 2016, with median rental prices down 21 per cent over the same period.
However, it argued there were indications the market was bottoming out, with the pace of declines in rental and sales values slowing and still attractive yields for buy-to-let investors in some areas.
“In the popular Springs community, it is now possible to achieve net yields of up to 6.5 per cent and net returns on equity of circa 10 per cent for finance buyers using 75 per cent loan-to-value mortgage products,” said John Lyons, head of sales and leasing at Espace Real Estate, a Propertyfinder client.
“This provides great financial incentive to buy rather than rent.”
PropertyFinder cited Numbeo data and its own figures as confirming Dubai was significantly cheaper per square metre than Hong Kong and other cities.
Prices in Downtown Dubai stood at $6,400 per square metre in March 2017, compared to around $25,090 in central Hong Kong, $17,970 in an equivalent part of London and $11,955 in New York, it said.
It also said April Central Bank figures showing the highest amount of money in circulation in the UAE since at least January 2013 meant there could be potential capital ready to be deployed into real estate.
Despite this optimism, some real estate consultancies have pointed to concerns of over supply in the emirate due a significant pipeline of new units.
CBRE said in January that 70,000 units are scheduled for delivery between 2017 and 2019, which could have a dampening effect on the market.
Many commentators have predicted the market will show signs of recovery before the end of the year, however, the sector continues to face challenges including the lower oil price and strength of the dollar.