Post by fireopal on Jul 15, 2009 22:59:22 GMT 4
UAE property prices rise sharply
Jul 15, 2009
Property prices in some areas of the UAE have risen sharply in the last few months as investors regain their confidence and snap up bargains, brokers said on Tuesday, in the face of gloomy reports of further price falls.
Brokers said in parts of Dubai such as Palm Jumeirah prices have climbed up to 20 percent, while in Abu Dhabi prices in areas such as Al Reem Island have seen a 30 percent jump, UAE daily the National reported on Wednesday.
“People are less hesitant and are prepared to spend a bit of money,” Gregory Antioch, a senior sales negotiator at the Dubai property broker Smith and Ken, was quoted as saying.
“It’s mostly end-users realising it’s cheaper to buy than rent. Distressed sales have pretty much gone.”
Brokers said June was the third successive month of prices rises, but were hesitant about saying the market had finally bottomed out and some warned of further declines, the newspaper reported.
Many analysts have recorded month-on-month rises property prices in the last few months, but the precarious state of Dubai’s economy and especially its real estate market still weigh on investor confidence.
In Dubai agreed prices rose 5 percent and 4 percent in April and May respectively, while in Abu Dhabi prices climbed 7 percent and 2 percent, according to HSBC.
However, the likes of EFG-Hermes has predicted a recovery in Dubai’s real estate market will not happen until 2011.
Many analysts have forecast Dubai house prices could fall another 20 percent this year, as the former boomtown continues to suffer a sharp economic downturn.
Property values have already fallen by 50 percent from peaks in some parts of Dubai in the wake of the global financial crisis, which saw demand and financing dry up.
A further 20 percent would mean some investors will be left holding assets worth only 40 percent of original prices come the end of the year.