Falling prices push up dubai yields

Falling property prices in Dubai are "not totally bad news", Knight Frank notes, as the agency highlights the positive impact the market's slowdown has had upon investment yields.

Prices have fallen this year in the emirate, thanks to declining oil prices and measures introduced by officials to curb speculative investment amid fears of a potential bubble. Nonetheless, the market's correction has pushed up rental yields in the mainstream property sector to over 7 per cent.

"Looking into the city’s sub-markets, the picture is a bit more positive as well. In-demand areas are mostly in the prime segment including villas, townhouses and apartments in the Palm, Emirates Hills, Dubai Marina and Downtown for example. Even during the 2008 downturn, prime properties saw lower levels of declines compared to less established areas," comments Diaa Noufal, MENA Research at Knight Frank Dubai office.