dubai prime residential report - knight...
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DUBAI PRIME RESIDENTIAL REPORT Q1 2015
Quarter-on-quarter, prime residential prices in Dubai fell by 0.8% in the three months to March 2015 – the third consecutive quarterly decline. This meant that annual price growth fell into negative territory for the first time since Q2 2011. Indeed, in Q1 2014, prime home prices were down 1.1% compared to a year earlier.On a more positive note, after a weak end to 2014, transaction volumes in the prime segment recovered somewhat in the first quarter of this year. That said, the number of monthly transactions remained low in context of levels seen in much of 2013-14.
Meanwhile, real estate investors from Russia – who ranked in the top 10 of the most important buyers of Dubai real estate in Q1 2015 – have faced significant difficulties in
recent times as the Russian Rouble has plummeted against the AED (which, of course, is pegged to the US dollar). The same is also true for buyers holding the euro, albeit to a much lesser degree. Over the past couple of months though, the pressure has alleviated a little for both types of buyer as their currencies have seen a partial reversal in fortunes.
FIGURE 1
Number of Monthly Residential Transactions Recorded Across the Prime
35
30
25
20
15
10
5
0
Sep 07 Mar 08 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15
Number of residential transactions worth over AED 10M, Dubai
Source: REIDIN, Knight Frank
GREGORY LEWIS Dubai Residential Sales
KEY FINDINGSAccording to the Dubai Land Department, in Q1 2015, 123 different nationalities spent a total of AED 24 billion across the emirate’s real estate sector.
Indians remained the top foreign property investors – spending more than AED 3 billion.
British and Saudis invested almost AED 1.9 billion each.
Overall though, the Emiratis (AED 5.8 billion) were the leading real estate investors in the first quarter of this year, accounting for 24% of the total spent.
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Knight Frank UAE Limited - Dubai: “PSIREB” RERA ORN: 11964 trading as Knight Frank with registration number 653414. Our registered office is: Unit 508, Building 2, Emaar Business Park, Dubai, UAE, PO Box 487207.
UAE RESIDENTIALGregory LewisSenior Negotiator+971 56 6695 [email protected]
Maria MorrisResidential Project Marketing, MENA+971 56 4542 [email protected]
INTERNATIONAL RESIDENTIALVictoria GarrettAssociate Partner+971 56 7835 [email protected]
Sarah May-BrownAssociate Partner+971 50 6138 [email protected]
RESEARCH & CONSULTANCY DEVELOPMENTHarmen De JongPartner+971 56 1766 588 [email protected]
Khawar KhanResearch Manager+971 56 1108 [email protected] VALUATIONStephen FlanaganPartner+971 50 8133 [email protected]
FIGURE 3
Amount Invested by Selected Nationalities in Dubai’s Real Estate, Q1 201514
12
10
8
6
4
2
0GCC
Bahrain
IraqEgypt
Oman
Other Arabs Non - Arabs
Kuwait
KSA
UAE
OtherNon-Arabs
RussiaIran
UK
Pakistan
India
Others
Lebanon
Jordan
Qatar
FIGURE 2
Prime Residential Price Growth, Dubai
35
30
25
20
15
10
5
0
-5
-10
-15
35
30
25
20
15
10
5
0
-5
-10
-15
2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014 Q1 2015 Q1
Source: REIDIN, Knight Frank
Source: Dubai Land Department, Knight Frank
Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15
240
220
200
180
160
140
120
100
80
FIGURE 4
UAE Dirham vs. Other Currencies (Index: June 2014 = 100)
Source: OANDA, Knight Frank
AED / EUR
AED / INR
AED / PKR
AED / RUB
AED / GBP
% q/q change
% y/y change