Secondary property prices in Abu Dhabi and Dubai dropped 5 percent and 4 percent respectively, with the villa prices in Dubai dropping 19 percent month-on-month in October, following the tightening of lending conditions by several banks in August and September, HSBC reports.

The Prices in Dubai on the Pal on Palm Jumeirah fell 32 percent and the prices at the Dubai International Financial Center (DIFC) prices fell by 30 percent. The villa prices at Arabian Ranches fell 18 percent.

In Abu Dhabi, the apartments at Al-Raha Beach fell 16 percent, and those at Al-Raha Gardens dropped 12 percent.

Villas that were much in demand before the crisis have fallen. The buyers were chasing sellers, and now it is the other way round, said a property consultant at Engel & Volkers. However, small real estate companies may close down.

According to a senior sales agent at Al Jabal Real Estate, a three bedroom villa in the un-built Jumeirah Park Project, which was worth around Dh.4.8million in August, is now about Dh.3.8million.

“The market is going through a rough patch. Whether or not it is the end of the market, should be waited and watched,” said Sana Kapadia, Associate Equity Research, EFG-Hermes Dubai.

Posted on 17/11/2008

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