Despite the coronavirus, Dubai actively develops in all directions: the economy is recovering from the crisis, international influence is increasing and the residential sector is developing. The latter shows impressive results. Read more about the current situation in the Dubai real estate market, sales rates and demand leaders.
Our catalogue offers the very latest luxury property in Dubai.
Content:
- Residential sector on the way to recovery
- List of the most popular off-plan luxury properties
- Sales rates in the most popular areas of Dubai
- Prospects for the real estate market in Dubai
- Real estate price increase
- Investment activity growth
- Dubai-Luxury.Property helps buy real estate in Dubai
Residential sector on the way to recovery
The most difficult period for the Arabian real estate market was the second quarter of 2020. There were measures for social distancing and self-isolation of nationals. COVID had a major economic impact on Dubai. However, thanks to timely measures taken by the government (vaccination, control of mortgage interest rates) decreased sales in the second quarter of 2020 turned into transactions in June, 2020. According to Property Monitor, by October 2021 property sales reached AED 54.21 M (about USD 14.76 M) demonstrating positive dynamics.
Later, the Dubai Land Department (DLD) successfully implemented a new transaction registration system, which immediately showed its effectiveness. As result, 550 transactions in the amount of more than AED 600,000,000 were carried out.
The service allows you to buy a real estate remotely and communicate with your real estate agent and the owner through video conferencing. Money transfers began to be made from the buyer's account to the seller's account within 3 days. This process is comfortable for both buyers and sellers.
List of the most popular off-plan luxury properties
The residential market in Dubai is actively developing. According to reports of the DLD off-plan transactions accounted for 49.3% of total real estate transactions in the first half of 2020. In 2021, off-plan real estate indicators increased by 15% within a month.
According to the DLD data, the main sale pulls were connected with residential communities:
- MBR City – 11,5%;
- TilalAlGhaf – 10,1%;
- Dubai Hills Estate – 9,9%;
- Nad Al Sheba – 8,2%;
- Rukan – 5,8%.
These statistics can easily be explained by the changes in consumer demand. They started to choose projects, which are located in communities with excellent infrastructure for family life.
The most popular projects are Jumeirah Village Circle (JVC) and Akoya Oxygen. These communities include spacious villas, upgraded areas and townhouses, which also became interesting for foreign investors.
Rukan's projects in Dubai Land and EMAAR South in Dubai South are also popular among property buyers and investors. These projects are located next to the Dubai Expo-2020 site. It is considered to me income producing properties investors.
Dubai South offers great options of properties, including townhouses, luxury villas and apartments. It`s located near to the international airport and Dubai Expo-2020.
Sales rates in the most popular areas of Dubai
In 2021, Downtown Dubai, Palm Jumeirah, Dubai Hills Estate, Business Bay, Town Square and Mohammed Bin Rashid City became really attractive areas for ordinary buyers and investors in Dubai.
In the pandemic, the DLD noted the increasing demand in townhouses and villas. These real estate options are still relevant in August 2021.
DLD reports that in August 2021, there were about 283 transactions worth 580,550,000 million (USD 158,000,000)in the Dubai real estate market.
According to the statistics published on the DLD website, on August 18, 48 real estate properties in the amount of AED 105,000,000 (USD 28,540,000 million) were bought at mortgage, and 12 properties in the amount of AED 23,000,000 (USD 6,220,000) were purchased as a gift. The DLD also announces the sale of 58 land plots, 20 of which were purchased at mortgage.
According to the report by Property Monitor, the development of the residential sector in Dubai continues to grow since April 2021.According to current indicators, this situation will continue until 2022. From April to June 2021, the value of transactions increased by 51% and amounted to AED 31,030,000,000 (USD 8,450,000,000). However, from January to March 2021, the amount was AED 20,780,000,000 (USD 5,560,000,000).
The report also shows that prices for villas increased by 27%, as it is in great demand at buyers.
In the second quarter of 2021, the Jumeirah Park residential community became the leader in the real estate market. The number of sales increased by 27%, followed by the Springs Dubai with 24% growth, and Dubai Hills Estate - 19%.
Apartments in Dubai also showed significant growth.
The TOP-3 sales leaders include:
- Palm Jumeirah, where the price for apartments increased by 13%;
- The second place is Business Bay - 12%;
- The third place is Jumeirah Lakes Towers (JLT) - 10%.
Prospects for the real estate market in Dubai
S&P Global analysts believe that this growth will continue by 3-5% until the end of 2021. Besides, the increase in Dubai's GDP is expected by 3.5%. If everything goes in this way, there will be GDP growth rate by 2.5% in 2022.
It is worth noting that the development is observed in all sectors of the real estate market in Dubai. The monthly market report by Property Monitor shows that the demand is growing in both the primary and secondary markets. In the first quarter of 2021, the number of secondary market transactions increased by 72% compared to the same period last year. Moreover, ready-built apartments sold 40% better. There were 231% increase in sale of townhouses and villas.
About 30% of all transactions with townhouses were pulled over by Dubai Hills Estate, Arabian Ranches and Springs Dubai.
In some areas, the number of transactions has reached unprecedented proportions. For instance, in Town Square, the total number of transactions increased by 800% in comparison with 2020. There was a 6-fold increase in transactions in Green Community, and a 3.5-fold increase in Palm Jumeirah.
Real estate price increase
In the first 3 months of 2021, the price increase in the real estate market occurred since 2016. The result of the increase is a strong market recovery.
Social and visa reforms, coronavirus vaccination plan, comprehensive development of the business sector, as well as simplified access to public finance for foreign played a significant role in it. Nowadays, the average cost of 1 m2 is about USD 2,600. Banks offer low mortgage rates to foreigners. Despite the price increase, now it is easier to buy Arabian real estate than before.
The luxury real estate market should also be noted. Now it has a lot of attractive proposals at reduced prices. The owners also provide good discounts to those who buy a property without mortgage.
Investors will need from AED 360,000 to enter the real estate market in Dubai. This is the minimum price, for which it is real to find a ready-built property. There are cheaper options, but it usually does not have much investment potential. There is a high probability of problems with rent or resale, which will prevent you from getting maximum income. Every month, many foreigners come to Dubai in search of affordable options, so cheap properties will be income producing.
Investment activity growth
The fact that for the first time in 7 years, the Dubai real estate market has become to grow suggests that the situation will be the same in the near future. Investors, who are interested in buying a villa or apartment, will get an income in up to 15%, depending on the type of rent that the owner prefers, as well as ROI due to increased demand among foreign renters.
Since the opening of borders and ongoing vaccination, Dubai has been welcoming investors from all over the world to its territory. The real estate sector is developing and a stable positive trend is being formed.
Dubai-Luxury.Property helps buy real estate in Dubai
Are you thinking about buying a property in Dubai? The specialists of Dubai-Luxury.Property will help you to make the right choice. If you are looking for an apartment to live in Dubai, or you want to make a wise investment, the company's agents will offer you the best options. Find your dream apartment in Dubai today!
