Further to our analysis of the UAE real estate market entitled ‘Foundations of Optimism’ published back in April, we have recently reviewed 1H 2018 data. While the direction of travel for residential and commercial property (sales and rental) prices in 2018 remains downward, data suggests that the pace of weakening is steadily slowing. Therefore, while the regional macro backdrop is improving, the sentiment toward UAE real estate seems set to remain selectively optimistic. We believe that property prices and yields may still have room to weaken further with supply the greatest threat to sector performance, but the latest data does suggest that the pace of decline is slowing.
Simon Ballard, Exec. Director & Macro Strategist