Dubai house prices growing at world's fastest rate

A number of strict measures undertaken by Dubai authorities, including doubling the property registration fees and increasing the down payment requirements, among others, have begun paying dividends as the growth in prices of Dubai residential property is seen slowing down, according to a new report.

Real estate broker and research firm Knight Frank said in its latest report that Dubai continues to top its Global House Price Index annual rankings for the fourth consecutive quarter, with recorded price growth of 27.7 per cent in the year to the end of March.

However, the firm noted that measures including the doubling of transfer fees and the mortgage cap are having an impact on the emirate’s property market, as average home prices rose by just 3.4 per cent in the first three months of 2014.

The turnaround in the US, Australian and Icelandic housing markets is evident with all three countries now appearing in the top ten rankings for annual price growth alongside key emerging markets such as China, Turkey and Brazil, the report states.

The rate at which house prices are rising globally has seen a slowdown, the Knight Frank report suggests. The Global House Price Index has risen for eight consecutive quarters but the rate of price growth slowed in the first three months of 2014, the firm noted.

Although the index saw slower growth in the first quarter of 2014 – rising by 0.6 per cent compared to 1.2 per cent last quarter – it still recorded annual growth of 7.1 per cent.

Knight Frank maintained that the final quarter of the year often sees a peak in sales transactions as buyers rush to complete sales before the New Year when new tax rules come into effect (in countries where such taxes exist), leading to a quieter market in the first quarter.

For the first time since 2008, no single country tracked by the Global House Price Index has recorded an annual price fall in excess of 10 per cent, it noted.
 

Source: Knight Frank

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