Today Reidin, the leading real estate company focusing on emerging markets, released their June residential price indices for Dubai.
According to the report, overall sale prices increased marginally by 0.04% in June versus May. However when compared to last year same period, prices are 0.72% down.
When looking on a granular level, we see that the month of month increase is led by apartments (+0.06% when villas are at +0.02%). Year on year, prices are respectively down 0.67% for apartments and 0.90% for villas.
On the rental side, the shortfall is more pronounced as June is down 0.92% versus May while year on year prices are down 4.95% .
As per the sales figures, villas are the most affected by this decrease with a drop of 0.63% month on month and 6.48% year on year when apartments are down 4.67% year on year and 0.92% when looking on a monthly basis.
We have all known for a while now that the market is currently correcting and therefore those figures are not a surprise. However the good sign is to see that sale prices are maintaining month on month and this has been the case for the last three months. This is once again a good indicator that the price correction the market has experienced over the last three years is bottoming out.
On the other hand, the decrease in rental price can possibly lead to a tenant driven market where landlords will have to show more flexibility on the number of cheques requested or even on price.