Dubai apartment prices rise 10pc, villa prices 30pc in 2006
Apartment prices in Dubai rose 10.1 percent by October 2006 while villa prices roses staggering 30.1 percent.
The significant jump is attributed to rapid population growth, increased investor and speculators interest and demand for second homes from people living in trouble spots in the region according to data from the Prime Group quoted by Standard Chartered Bank, said Gulf News.
Meanwhile, Standard Chartered's new residential property index, which uses offer prices of developers, has shown an 18.8 per cent rise in 2006 until the end of October.
However, the rise is expected to cease once supply catches up to demand in the emirate said the bank's representatives.
"We have argued before that residential property prices are likely to come down 20-30 per cent in the next two to three years," pointed out Steve Brice, regional head of research for the bank for the Middle East.
"The good news is that this is not expected to have a dramatic impact on the UAE economy with the correction expected to be gradual."