Dubai property prices sink 7.4 percent as UAE jobs growth slows

Dubai property prices sink 7.4 percent as UAE jobs growth slows

Dubai property prices sink 7.4 percent as UAE jobs growth slows

DUBAI: Prices for Dubai’s residential real estate sank 7.4 percent in the third quarter of 2018 from a year earlier, with the drop accelerating from a 5.8 % fall in the second quarter, the United Arab Emirates central bank said in a tell of on Tuesday.

Prices have been falling quarter-on-quarter as good as continually since the start of 2017 because of a worsening supply/demand balance. The central bank quoted the REIDIN residential sales price index, which showed prices fell 2.5 percent from previous quarter in July-September.

Residential real estate prices in neighbouring Abu Dhabi,  other big emirate in the UAE, dropped 6.1% year-on-year in the third quarter after a 6.9 % slide in the second quarter.

One factor weakening demand for real estate is subdued employment growth in the UAE, particularly between white-collar workers who might buy homes. Most jobs in the wealthy oil-exporting country are held by foreigners.

Total employment grew just 0.6 percent from a year ago in the third quarter— slowest rate in over four years_after 1.2 percent growth in the second quarter, central bank said.

In the first nine months of 2018, employment grew at an average rate of 1.6 % against a 2.6 percent increase in the same period of 2017.

The central bank figures showed employment in sectors including construction and actual estate continuing to expand, partly because of Dubai’s preparations to host  Expo 2020 world’s fair.

But employment in some sectors that generate large numbers of white-collar jobs, such as services, fell in  third quarter, in some cases at their fastest rates for several years.

In an effort to bolster white-collar numbers,  UAE government last week announced a scheme to offer long-term visas to rich property investors, senior scientists and entrepreneurs.

But eligibility for  visas is tightly restricted and they don’t offer a path to UAE citizenship, so analysts said the scheme might do little by itself to change employment or real estate market trends.

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