The report also noted that prices for villas fell by 13% over the quarter and apartment prices were down by 14%.
In the lettings sector, apartment rents were down by 3% and villa rents down by 3% quarter on quarter. On an annual basis they fell by 11% and 9% respectively.
The report explained that due to a slowdown in new project launches, the emphasis in the third quarter was solely on completed properties available directly from developers, or offered in the secondary market.
Then there are relatively new trends and initiatives, such as rent to own schemes and crowdfunding to stimulate the market and tap into what Asteco believes is a considerable amount of pent-up demand from end users and/or first time buyers.
In addition, real estate professionals and participants have been increasingly vocal in urging the UAE Central Bank to lower existing loan to value ratios to facilitate home ownership for those unable to afford the current mortgage deposit requirements.
“Although no such changes have yet been announced there appears to be a consensus among many that these reforms would provide the stimuli needed to boost the real estate market,” stated the report.
“With the 2018 Dubai Cityscape around the corner, it will be interesting to see the extent of new project launches and how developers plan to entice Investors, whether with proven schemes or by offering new and improved incentives and payment terms,” it further added.
In the rental market, locations with high handover volumes recorded the sharpest rental rate declines and a significant rise in tenant turnover.
The report pointed out that wider economic uncertainties may have resulted in many residents downsizing, or to seeking value for money properties in less established areas.
Conversely, many tenants continued to take advantage of the abundance of choice and decreasing rents to upgrade to larger units, better quality specifications and/or more popular locations and rental rates are expected to come under further pressure this year, a trend that is likely to spill over into early 2019.
The total anticipated delivery for 2018 is now estimated at 16,750 residential units and while this is a large volume—it is still a notable decline on previous projections, according to the report.
Although the number of project delays is substantial, it is noteworthy that construction milestones have in general been met with delays ultimately resulting from overly ambitious handover programmes.
As a result, a sizeable number of units previously forecasted for completion in the second half of the year will fall into 2019.