Prices at apartments in Dubai fell by an average of more than 11% during 2016 as the housing market battled tough conditions in the economy said a report by Bayut.com a property online site.
In its report released annually, the company said that prices of apartments in Dubai fell from Dhs2.57 million during 2015 to just over Dhs2.29 million in 2016.
Rents were not as affected, but still were down 6% from the average in 2015.
The site said that rent for studios was down by 8%, while prices dropped 5% for buying studios.
Rent for a one-bedroom apartment was down 5% while purchase prices for the same were down 10%. For two-bedrooms, rent was lower by 8% and the price to purchase fell by 11%.
Units that were three- and four-bedrooms were down 6% and 8% respectively for rent and down 11% and 15% for purchases.
During 2016, the best rental yields were in studios with an average of 7.4% followed by yields of 7% in one-bedroom units, 6% in two-bedroom, 5.4% in three bedroom and just 3.4% in four bedroom units.
Across Abu Dhabi, rents were down on average over 6% during 2016 but sales prices were off by only 1%.
Studio rents fell 8% and sales prices fell 1%. Rent for a one-bedroom unit fell by 6% while the sales price of the same dropped by 2%. Two-bedroom units saw a drop of 5% in rent, with the average sales price remaining the same as in 2015.
Rent for a three bedroom units were down 6% in 2016 while sales prices remained the same. For a four-bedroom unit, rent was down 6% and the average sales price was the same as in 2015.
The average yields for studios were 8%, for one-bedrooms 7.1%, for two-bedrooms 7.2%, for three-bedrooms 6.5% and for four-bedrooms 5.2%.
The online site said in its report that there were signs that a positive recovery for the market could be in store for 2017 although other companies warned that a strong U.S. dollar and more new units being built could hit prices again during 2017.
The Gulf region has been hit hard by the drop in oil prices that has affected almost every country’s government due to them being so dependent upon revenue generated by oil sales.