Approximately 28,000 additional residential units are currently scheduled for completion in 2012, according to Jones Lang LaSalle. This figure would represent an 8% increase on the current stock.
While liquidity is returning to the residential market and some previously stalled projects are recommencing, the investment advisory firm expects that a substantial proportion of the supply will experience further delays.
Nearly 3,000 additional residential units were added to the market in Q1 2012. The total current residential stock is estimated to around 341,000 units at present. Almost 90% of the completions in 2011 were apartments.
Most of the apartment projects handed over during the first quarter included the first phase of Remraan Community in Dubailand and Emaar‟s Claren 1 Tower in Burj Downtown.
Looking forward and assuming that all supply tracked by Jones Lang LaSalle‟s quarterly survey will complete, 43,000 additional units are due to be delivered to the market by the end of 2014.
Asking rentals have remained stable in established locations during Q1 2012, but are expected to increase in 2012. Villa rents have increased in Q1 2012 in prime established locations and this trend is likely to continue. Asking rents in less established prime locations expected to remain stable in 2012.
Apartment sale prices are expected to remain stable in prime buildings within established locations during 2012. As at Q1 2012, villa sale indices are 3% higher than January 2008 levels. Prices are expected to increase in well established prime areas in 2012, while those in less established secondary locations will continue to decline as investors seek quality product.
