Real estate data intelligence is available for businesses and governments, as Property Monitor puts it. After evaluating data, you will notice that the pressure from both the residential and commercial sectors puts Dubai in a tricky position.
What are the reasons for this?
The State of Dubai’s Residential Sector
In 2017, the values of residential properties were expected to go down by five percent. Given the current situation this year, however, there is still potential for values to begin bottoming out during the last few months of the year.
But the possibility of this expectation relies on the “Expo 2020 effect,” which has yet to materialise. Other factors that may contribute to this include the strength showed by the US dollar and the gradual rate of delivery and type of new residential schemes.
Housing affordability also plays a crucial role in helping the market stabilise. You may see values declining by an average of three to five percent by the end of the year. But it all depends on the factors. One thing may be certain: the rental market might soon mirror the performance of capital values.
What Dubai’s Commercial Sector Looks Like
So far, Dubai’s commercial market has shown resilience. The market owes this to the diverse nature of occupiers in the region, due to the emirate’s diversified economy.
Dubai only welcomed the Value Added Tax (VAT) this year. In 2017, office rentals were well off in many submarkets because of the implementation of the VAT and while the market remains fragmented. The resilience shown by the Dubai commercial sector may go on throughout the year.
Fresh demand for office spaces may pop up as companies expand due to the impact of Expo 2020. Shops may even become more widespread across the emirate to help Dubai achieve its ambitious construction and infrastructure projects expected to be over by 2020.
It’s no surprise that the residential and commercial sectors of the city see great demands that will most likely continue until the end of the year. The outcome, however, heavily depends on the occurrence of the contributing factors mentioned.