Dubai - Mubasher: As UAE's local economy continues to adjust to softening global conditions, overall residential values and rents in Dubai, Sharjah and Abu Dhabi are set for a further decline for the remainder of 2016,said a report published by the international real estate consultancy Cluttons.
The report shows that redundancies in the oil and gas, finance and banking sectors have negatively impacted demand in the residential property market across the UAE, with capital value and rental declines likely to be witnessed in Abu Dhabi, Dubai and Sharjah over the remainder of the year.
"A number of global economic factors are contributing to the current pressure on the UAE’s residential market, including low oil prices, Brexit, the EU’s sovereign debt issues and economic uncertainty in China," said Faisal Durrani, head of research at Cluttons.
"We are still some way away from the bottom of the market however, with Abu Dhabi in particular heavily impacted by the performance of oil and gas sector, with further corrections still coming through strongly, particularly at the top of the residential market," added Cluttons.
"In Dubai, we believe that the residential market will start to stabilise by the end of 2017, largely due to the ‘Expo 2020 effect’ and this in turn will influence the demand for real estate in Sharjah, but until then, further slight softening is expected in Dubai," pointed out the analyst.
However, Cluttons' forcasts will remain unchanged and on track, with Dubai likely to see residential values by the end of 2016 down by between -5% for apartments and -7% for villas.
