Prices in Palm Jumeirah sink

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Property prices on the Palm Jumeirah have begun to sink to a four year low, with apartments going on sale for as low as AED 650 per square feet. Studies show that a number of apartments on the Palm Shoreline have been put on sale in the past one month with prices nearly 70% down from the height of the boom. The lowest listed price is a C type apartment, occupying 2620 square feet, being offered for AED 1.7 million.

The government took a raft of measures as part of its efforts to underpin economic growth within its strategic plan 2011-2013, including extension of visa for real estate investors to three years instead of six months, a government official said. Despite talks of renewed interest in real estate following regional unrest, there is no visible sign of an improvement, the analysts wrote. Even if we believe the worst of the downtrend is now behind, new supply, lack of homebuyers appetite and anemic transaction activity point to further weakness, further added.

Home values declined 1.2 percent in May compared with the previous month and rents fell by 1 percent, analysts Nabil Ahmed and Athmane Benzerroug wrote in a note to investors. Apartment prices slid 1.3 percent in May, while villas declined 1 percent.

Sources: Arabian Business; Bloomberg

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