Q4 2015 Dubai Residential Market Report

Page 1

Dubai Residential Market Report

Q4

2015


Dubai Residential Market Report - Q4 2015

Content • Price performance • Rent performance • Residential supply • Cavendish Maxwell Residential Market Survey - Q4 2015

Sale price movement Q3 2015 - Q4 2015

-1%

-1%

Q4 2014 - Q4 2015

-6% © Cavendish Maxwell 2016 | www.cavendishmaxwell.com

-8% 2


Dubai Residential Market Report - Q4 2015

Sale performance Apartments • Apartment prices declined, on average, by 1% in Q4 2015, where International City declined slightly faster at 2%.

• During the last 12 months, apartment price declines varied significantly across Dubai, dropping an average of 6% with peripheral locations such as Discovery Gardens, International City and Motor City declining the most at 9%, 9% and 10% respectively.

Figure 1

Apartments sale performance 0%

2,500 -1%

-1%

-1%

-1%

-1%

-1%

-1%

-2%

2,000

Average price AED / sq V

-1%

-4%

1,500 -6%

-­‐4%

-4%

-5% -6%

-­‐2%

-6%

-6%

-­‐6%

1,000

% change

-1%

-­‐8% -9%

500

-9%

-­‐10%

-10%

0

Business Bay

Q3 2015 © Cavendish Maxwell 2016 | www.cavendishmaxwell.com

Discovery Gardens

Q4 2015

Jumeirah Downtown Burj Dubai Marina Dubai Sports Emirates Living InternaOonal City Beach Khalifa City (Views and Greens) Residences Q3 2015 Q4 2015 QoQ % change 12 month change

QoQ % change Q3 2015 - Q4 2015

12 month % change Q4 2014 - Q4 2015

Motor City Palm Jumeirah (Shoreline Apartments)

-­‐12%

Source: Property Monitor Index

3


Dubai Residential Market Report - Q4 2015

Sale performance Villas • Villa prices have declined by an average of 1% in Q4 2015, slower than the 2% in Q3 2015. • On average, villa prices have declined by approximately 8% in the last 12 months. Prices at more established villa communities such as The Meadows and Springs declined by 12% and 18% respectively as buyers opted to purchase in the newer and upcoming communities.

Figure 2

Villas sale performance

-1%

-1%

-1%

-1%

-1%

-1%

-1%

-1%

-1%

-1%

-2% -­‐2%

1,600 1,600 1,400 1,400

Average price Average price AED / s/q sq S ft AED

1,200 1,200

1,000 1,000

-7%

-8%

-6%

-4% -­‐4%

-5%

-6%

-7%

-7%

-10%

-­‐10% -10% -12%

-­‐12% -12%

600 600

-­‐14% -14%

400 400

-­‐16% -16%

200 200

Q3 2015

-6% -­‐6%

-­‐8% -8%

800 800

0 0

0% 0%

% change

1,800 1,800

-­‐18% -18%

-18%

Al Furjan Arabian Arabian Jumeirah Jumeirah Jumeirah Jumeirah Jumeirah Al Furjan Golf Jumeirah Villas Ranches Ranches Golf Estates Islands Islands Park Villas Estates Park

Q4 2015

Q4 2015

Q3 2015

QoQ % change Q3 2015 - Q4 2015 Q3 2015

© Cavendish Maxwell 2016 | www.cavendishmaxwell.com

Q4 2015

Jumeirah The The Lakes Lakes Jumeirah Village Village Triangle Triangle

QoQ % change

The The Springs Springs The The Meadows Meadows

12 month change

12 month % change Q4 2014 - Q4 2015

QoQ % change

12 month change

Victory Victory Heights Heights

-­‐20% -20%

Source: Property Monitor Index

4


Dubai Residential Market Report - Q4 2015

Rent performance Apartments

Villas

• Apartment rents have slightly declined by 1% in Q4 2015 and approximately 3% during 2015 across Dubai.

• Villa rents have followed a similar trend as apartments with an average drop of 1% in Q4 2015 from Q3 2015 and a 3% decline during 2015.

• The rate of decline varies from one development to another with International City rents declining at a higher rate of 2%, similar to the sale price trend in Q4 2015.

• Rents in prime villa communities such as Arabian Ranches, Jumeirah Golf Estates and Jumeirah Islands remained relatively stable in Q4 2015 as in Q3 2015.

• On average, studio rental rates have increased while one and two bed rents have during Q4 2015.

Apartments rental performance Rental rate AED/sq ft/annum Q4 2015

Villas rental performance Studio

1 bed

2 bed

Business Bay

97

94

89

Discovery Gardens

88

65

-

Dubai Marina

122

111

Dubai Sports City

96

International City

72

Rental rate AED/sq ft/annum Q4 2015

3 bed

4 bed

5 bed

Al Furjan Villas

49

-

42

Arabian Ranches

69

70

70

106

Jumeirah Golf Estates

70

63

60

71

70

Jumeirah Islands

-

59

61

65

52

Jumeirah Park

64

61

62

Jumeirah Beach Residences

111

116

115

Jumeirah Village Triangle

55

53

-

Motor City

84

70

69

The Lakes

76

75

86

-

111

107

The Meadows

64

62

66

The Greens

147

111

102

The Springs

74

70

-

The Views

150

118

107

Victory Heights

-

75

70

Palm Jumeirah (Shoreline Apartments)

Figure 3

© Cavendish Maxwell 2016 | www.cavendishmaxwell.com

• Rents of three and five bed villas remained stable, whereas four bed villa rents have declined in Q4 2015.

Source: Property Monitor Index

Figure 4

Source: Property Monitor Index

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Dubai Residential Market Report - Q4 2015

Residential supply 2015 Completions • Approximately 8,800 additional residential units entered the Dubai market in 2015. • Over 70% of those are apartments with the remainder being villas and townhouses. • Major completions in Dubai Sports City, Dubai Silicon Oasis and Dubailand.

Pipeline • Approximately 7,000 units have been delayed from 2015 to 2016. • Excluding those, 30,000 units have been scheduled for delivery in 2016, which may be subject to potential delays. • The Dubai government budget for 2016 was increased by 12% to AED 46.1 billion, of which 14% allocated to infrastructure, which shows continued commitment toward the growth of Dubai leading up to 2020.

© Cavendish Maxwell 2016 | www.cavendishmaxwell.com

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Dubai Residential Market Report - Q4 2015

Cavendish Maxwell Residential Market Survey Looking back - Q4 2015 - sales and rents

vs

predictions

reality

36% of agents surveyed had predicted villa prices to decline by up to 5%

Villa prices fell by 1%

40% of agents surveyed had predicted apartment prices to remain unchanged.

Apartment prices fell by 1%

Majority of agents surveyed had predicted that rents would remain the same for both apartments and villas.

Apartment and villa rents declined by 1%

Q1 2016 sales outlook

Q1 20165 rents outlook

Apartments Percentage of agents who predicted apartment prices would: 0% 14%

Villas Percentage of agents who predicted villa prices would: 0% 5%

7%

9%

18%

38%

33%

increase by up to 5%

not change

Figure 8

Š Cavendish Maxwell 2016 | www.cavendishmaxwell.com

decrease by up to 5%

Villas Percentage of agents who predicted villa rents would: 2% 14%

11%

34% 34%

43%

39%

46%

increase by more than 5%

Apartments Percentage of agents who predicted apartment rents would: 3%

decrease by more than 5%

Source: Cavendish Maxwell Residential Market Survey

increase by more than 5% Figure 9

increase by up to 5%

not change

decrease by up to 5%

5%

45%

decrease by more than 5%

Source: Cavendish Maxwell Residential Market Survey

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PROPERTY SERVICES MIDDLE EAST & AFRICA

Jay Grant MSc IRRV (Hons) Managing Partner M: +971 50 192 1658 E: jay.grant@cavendishmaxwell.com

Miles Phillips BSc (Hons) MRICS ACIArb Partner Head of Operations - UAE

Also contact us for:

M: +971 56 604 2750 E: miles.phillips@cavendishmaxwell.com

Jonathan Brown BSc (Hons) FRICS Head of Abu Dhabi Office M: +971 50 940 3540 E: jonathan.brown@cavendishmaxwell.com

Residential Valuation

Commercial Valuation

Machinery and Business Assets Valuation

Investment and Commercial Agency

Project and Building Consultancy

Development Advisory and Real Estate Research

Hotels, Hospitality and Leisure

Property Monitor

Sofia Underabi BPropEc AAPI Partner Head of Residential Valuation M: +971 50 435 6527 E: sofia.underabi@cavendishmaxwell.com

Dima Isshak BSc

Research Manager

M: +971 50 482 7938 E: dima.isshak@cavendishmaxwell.com

CavendishMaxwell.com T: +971 (0) 4 453 9525 E: info@cavendishmaxwell.com 2205 Marina Plaza, Dubai Marina, P.O. Box 118624, Dubai, United Arab Emirates 1006 Corniche Bakery Building, Al Firdous Street, Tourist Club Area, Abu Dhabi, United Arab Emirates


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