Prices for apartments in the world’s tallest tower have fallen by as much as 25 percent over the last year amid a global rout in luxury property.
Despite the sharp fall, towers surrounding Dubai’s Burj Khalifa skyscraper and with a view of the landmark building have held their value, brokers say.
“In particular, where we are seeing a big correction is the very top of the market.The top of the market is still correcting quite sharply and that is in line with what we are seeing globally, where the appetite to purchase high end luxury homes is weak,” said Faisal Durrani, the head of research at Cluttons, the real estate broker.
“If I was to list the five weakest markets in Dubai, I’d start with the Burj Khalifa. On a year-on-year basis, your values there are down by between 20 and 25 percent. Second to the Burj Khalifa would be apartments on the Palm Jumeirah, followed by large villas in Arabian Ranches, followed by large villas in Emirates Living.”
At over 828 meters and 160 floors, the Burj Khalifa is the world’s tallest tower. It has also broken other records including the world’s tallest structure, previously held by the KVLY-TV telecommunications mast in Blanchard, North Dakota, and the tallest free-standing structure, previously held by Toronto’s CN Tower.
It is set to be trumped by the Kingdom Tower under construction in Jeddah, which is expected to top out at about 1,008 meters and 170 floors.
The sharp decline in prices at the top end of the residential property market in Dubai is part of global rout in luxury property prices that has also wiped millions of pounds from some of the top addresses in the most desirable central London locations.
“We are seeing this everywhere,” added Durrani. “Here in London if you are looking at places like Chelsea, Kensington and Knightsbridge, prices are down by between 10 and 15 percent in the last 12 months, so it is very much a market that is hurting. It is a global phenomenon.”
The propertyfinder.ae website currently has more than 200 sales listings for the Burj Khalifa tower alone.
Some investors are selling entire floors for more than 50 million dirhams ($13.6 million). One four-bedroom apartment in the tower with a 2,000 square foot private terrace is being marketed at 28 million dirhams.
The website quotes average prices for four bedroom apartments in the building at 3,387 dirhams per square foot — compared to 4,351 dirhams per square foot a year ago.
The direction of Dubai residential property prices will be determined by the supply of new homes, said JLL in its latest market report released last week. There are about 78,000 units due to complete over the next three years.
“Our assumption that prices will see a marginal increase over the next 12 months is dependent on further delays to supply being experienced in line with the average materialization rate of 40 percent,” said the report. 

Source: Arab News