Dubai property asking prices still too high to sell
Posted on 26 May 2009 with no comments from readers
Even a cursory glance at the latest listings of Dubai property prices from a top agency like Better Homes confirms that sellers are far from being realistic when it comes to prices and are asking far too much if they expect to sell within the next two to three years.
After the oil price slump of last summer, the global financial crisis and the dollar’s appreciation can it be sensible to expect to obtain the house prices of last March? For that is what Dubai property owners seem to expect, albeit they now accept that the peak prices of last summer have gone.
True prices
However, the news from the marketplace is that in order to sell discounts of more like 50 to 70 per cent are the name of the game. Apartments are more numerous, and growing daily in number as the towers are completed, so price discounts are generally higher than for villas, although this is not always the case.
Should you therefore rush out and buy a villa in The Springs – an established new development which is not a building site – or wait for lower prices? There was a little excitement in this market recently when a few sellers managed to up the price on these town houses from $500,000 to $600,000.
That might be seen as a green shoot but then it is still around 50 per cent lower than last summer. And it is more likely to reflect the relatively small villa market rather than signal a recovery in the whole market.
Summer bounce?
Indeed, what could possibly cause such a recovery this summer? The end of June is going to see many expatriates depart for good, leaving empty properties. Meanwhile, developers boast in the newspapers every day about their completions.
It is hard then to see a bottom to the Dubai property market any time soon. But one thing that would certainly help is that people wanting to sell should start advertising at market prices, and stop clogging up the market with property that will never sell at the advertised price. Markets do always recover eventually and if sellers really want these prices then they need to wait.
