Market Trends of United Arab Emirates Residential Real Estate Industry
This section covers the major market trends shaping the UAE Residential Real Estate Market according to our research experts:
New Project Launches in Dubai are Expected to Boost the Market
The realty sector in Dubai is back in the limelight, beating the COVID-19-induced uncertainties, and it is showing strong signs of sustained growth if one is to go by the statistics released by the Dubai Land Department (DLD). A survey involving property analysts forecasted Dubai house prices to rise by 3.0% in 2021 and 2.5% in 2022 compared to 1.1% and 2.8% three months ago.
The survey predicts the Dubai residential property market to be on a steady course for a couple of years with a modest rise in prices. This indicates affordability on the one hand and sustainable growth on the other. Dubai now has a favorable climate for investment in properties, which gets further endorsed by leading real estate players who are planning new projects. Danube Group, for instance, is one among them.
The Off-plan Housing Segment Performing Well in Dubai
Sales of off-plan property in Dubai registered strong growth in 2021. In August 2021, off-plan properties recorded AED 4.95 billion, or USD 1.3 billion, across 2,599 sales deals. This is the highest sales value to be recorded for sales of off-plan property in Dubai since December 2013, representing an eight-year high. It also represents the highest monthly off-plan transactions by number since November 2019.
Arabian Ranches 3 and Villanova recorded the most off-plan villa and townhouse sales, the report said. A total of 187 units were sold in Arabian Ranches 3 and 157 in Villanova. Other areas of interest included Tilal al Ghaf with 79 units, Dubai South with 58 units, and Mohammed bin Rashid City with 16 units.
Meanwhile, in terms of demand for off-plan property in Dubai during August, top areas for villas and townhouses included Dubai Hills Estate, Arabian Ranches, Palm Jumeriah, Damac Hills 2 and Mohammed bin Rashid City. Dubai Marina, Downtown Dubai, Palm Jumeirah, Business Bay, and Jumeirah Village Circle were the most in demand for off-plan apartments.
Further, the average transaction price for off-plan property in Dubai saw a year-on-year increase of 53%, climbing from about AED 1.2 million in August 2020 to AED 1.9 million in August 2021. Median prices for off-plan apartment sales stood at AED 1.1 million in August 2021, a growth of 48% from AED 745,500 in the same period last year. Median prices for off-plan villas and townhouses stood at about AED 1.8 million for the month this year, gaining 12% compared to 1.6 million last year.
