A survey reveals that most of the high-end property deals are concluded by locals. The UAE has a high standard of living and a stable economy, so the demand for luxury sector properties in Dubai is high.
- Housing market in the time of pandemic
- Benefits of purchasing a luxury home
- Dubai property types
- Popular locations
- Luxury real estate boom
- We provide professional help in choosing real estate in Dubai, UAE
Dubai has not been hit hard by the global economic downturn, although it witnessed some house price declines over the past few years. Lured by lower prices, investors rushed to buying up properties. The attractiveness of real estate in Dubai is because of widespread availability of affordable mortgages. Lower interest rates on home loans have triggered more borrowings.
At the beginning of the pandemic, home sales fell but were followed by rapid growth in the first quarter of 2021. By the end of the third quarter, the market hit a few five and ten-year old records in terms of the number of sales and their total value. September made the third quarter the best one. The record sales amounted to AED 42.3 M. The number of property sales increased by 85.36% and the total cost of sales – by 135.4%.
After loosening the pandemic restrictions, property buyers have returned to the real estate market and are actively using mortgages to acquire villas and apartments. About 83% of transactions in the UAE are carried out using mortgages. Banks are ready to provide a mortgage for 80% of the property cost. Most lenders buy houses to improve their living conditions, but others buy property as an investment.
An influx of wealthy investors is boosting demand for high-end properties. Penthouses and villas become more attractive than ever during the pandemic, as they are the perfect lockdown properties. Below are some benefits of buying luxury homes:
- The UAE has a robust economy. The local currency is stable against the US dollar throughout the years, giving homes a good resale value.
- Tax incentives. There is no taxation on properties, which allows investors to avoid incurring additional expenses associated with owning or renting out their properties.
- An easy way to get a long-term residence visa. You just need to own real estate meeting the requirements to be eligible to become a UAE resident.
When investing at least $272,000, you can apply for a three-year residence visa. Buying a home worth over $2.7 million increases the visa period to 10 years.
In 2021, foreign buyers have flooded the real estate market in Dubai, not only because of favorable weather conditions. The other reason is affordable property prices. For comparison, 165 sq. meters would cost $1 million, while in large European cities and the United States you would buy only a home five times smaller for the same amount.
According to Zoom Property Insights, the most active foreign property buyers are nationals of India and Pakistan. They make 20-30% of all investors in Dubai. In the end of September 2021, it was said that the value of property transactions registered since January to September reached $28.4 billion.
Villas and mansions are not the only possible luxury housing options. Properties below are no less popular among homebuyers:
- Apartments. They are located in residential buildings and can take up one or two floors. Advantages of residential complexes include well-developed infrastructure; they have everything you need for a comfortable life, from swimming pools and sports clubs to playgrounds.
- Penthouses. Penthouse apartments are located on the upper floors of buildings and can occupy the entire floor. A private entrance and panoramic views are one of the leading reasons people want to live in a penthouse.
The properties’ size varies, starting from over 1,000 sq. meters for elite homes. Both new and existing homes are in equal demand. Existing house prices rose over 17%. Economists predict the growth will keep the pace in 2022. Yousuf Fakhruddin, the CEO of Fakhruddin Properties, said that property prices in Dubai have grown since the travel restrictions were weakened before Expo 2020 and international flights were resumed. He added that in the last quarter this year many foreign investors have invested in emirate’s property and real estate experts believe that this trend will continue for a while.
In Dubai, properties in some areas are not allowed for foreign ownership. However, transferable lease rights are permitted there. Still, these restrictions do not affect the quality of life as you always can find properties in central part of the city and in resort areas:
- The Palm Jumeirah area dominates in sales, followed by
- Dubai Marina. The neighbourhood is considered the most picturesque in the city.
- Several villas have been sold in Mohammed Bin Rashid City. It is a sprawling community with a lot of brand-new buildings.
Homes valued over $10 million are among the high-end properties seeing rocketing demand. In the reporting period, more than 20 units have been sold. Meanwhile, for the whole previous year, only 19 real estate objects were sold.
In many ways, the measures taken by the UAE government to combat the pandemic including vaccination and travel restrictions for those who have not been tested prompt the growth in sales. For the first time since 2015, the house market has developed rapidly.
In the first 4 months of 2021, over 80 villas worth over $2 million were sold in Palm Jumeirah, one of the most popular areas of Dubai. For the first time in recent years, the elite property demand exceeds its supply.
Property prices depend on the following factors:
- prestige of a building
- property size
- level of comfort.
According to the largest property platform in the UAE Bauyt, in 2021, average sales prices for residential properties in Dubai increased 10 percent from a year earlier. People from Europe and Asia move to Dubai with their families, attracted by business and investment opportunities, as well as the high quality of life in the country. The average starting price tag for an apartment at the end of the first half of the year was about $253,000. Penthouses are almost 2 times expensive. Meanwhile, the prime villa market remains at the highest level with a median value of about $1 million.
You do not have to come to Dubai to see what its residential property offers. You can browse property listings right on our website. We offer the vastest selection of homes in various parts of the city, to fit different budgets, ranging from family apartments to mansions with extensive land plots. Don't miss out on the opportunity to find your dream home now!