Dubai Real Estate Market Review 09-Jan-2024
Below are the latest real estate news and transactions.
Dubai real estate: Luxury branded residences segment predicted to see massive surge in 2024
Expectations of sooner-than-later interest rates cut, leading developers’ bid to add more advanced sustainability, technology and unique lifestyle elements in their upcoming projects seen driving demand.
Read the full article at Arabian Business
Some Dubai areas see shortage of smaller apartments
Dubai is facing a significant shortage of small living spaces, especially in its older districts like Bur Dubai and Deira, due to a rapid population increase and a lack of new housing developments. This trend has been fueled by the influx of foreign workers, professionals, and investors, with the city's population growing by over 100,000 last year.
Real estate industry experts point out that while older areas of Dubai are known for spacious apartments catering to larger families, they now fail to meet the current demand for smaller units. New Dubai, in contrast, is attracting more development with a focus on smaller, modern living spaces.
Alan James Gammon of ACE Luxury Property highlights the market's shift towards high-end developments, leading to a scarcity of affordable smaller units. Lewis Allsopp, chairman of Allsopp & Allsopp, notes that while New Dubai areas like Marina and JBR are seeing more sales and rentals of smaller apartments, Old Dubai is lagging due to restrictions on new constructions.
The changing real estate trends in Dubai reflect the city's evolving demographic needs, with a growing emphasis on developing properties that cater to its diverse and expanding population.
Read the full article at Khaleej Times
In Dubai property market, will 'buyback' schemes be a new sales strategy for developers?
In 2024, Dubai's property market is witnessing a surge in offplan launches, now accompanied by heavy promotions and innovative offers like ‘buyback’ schemes. Dugasta, a prominent developer, has introduced a buyback offer with its Al Haseen Residences project, located near Al Maktoum International Airport. This scheme promises to buy back the sold units in full after 5 years, should the homeowner choose to sell.
Buyback guarantees, a relatively new trend in the Dubai property market, represent a departure from the usual developer approach of stepping back after the primary sale. Previously, developers might only engage in managing rentals for the unit owners. Buyback guarantees, however, offer a more direct involvement from the developer and a higher level of commitment.
Tauseef Khan, Chairman of Dugasta Properties, highlights the advantages of this "Winter Deal," noting its potential for significant risk-free returns. Buyers are not only assured of a 50 percent return in the first five years but also a guaranteed buyback option after the fifth year, allowing them to potentially profit from price appreciation.
Additionally, service charge waivers are becoming a key competitive factor among Dubai developers. With more launches including 3-5 year waivers, buyers can save considerably, especially considering the recent general increase in service charges due to inflation. Prospective buyers are advised to research service charges and property values in their desired location to assess the full benefits of these offers.
Read the full article at Gulf News
Dubai Real Estate Transactions as Reported on the 8th of January 2024
Dubai Real Estate Market Sees Robust Transaction Activity Exceeding AED 1.35 Billion
In a recent report on Dubai's property transactions, the market has shown substantial activity with the total value of transactions reaching AED 1,354,699,130.94. The report provides a detailed breakdown of off-plan and ready property sales, reflecting investor confidence and market dynamics.
Off-Plan Property Sales
Off-plan properties have contributed a significant AED 663,021,949.81 to the total transaction value. Flats dominate the off-plan segment, with transactions totaling AED 588,280,457.81. This indicates a strong investor appetite for apartment living, with off-plan flats being a preferred choice, possibly due to their lower entry price point and the potential for capital appreciation upon completion.
Villas followed, with a transaction value of AED 56,935,611.00, showing a moderate but substantial interest in more spacious living options. Hotel apartments and residential units combined have seen transactions worth AED 12,556,021.00, a segment that may reflect the city's thriving tourism industry and the demand for short-term rental options.
Ready Property Sales
Ready properties, those completed and available for immediate occupation, showed a slightly higher transaction value than off-plan, totaling AED 691,677,181.13. Again, flats led the charge with transactions worth AED 511,280,835.27, underscoring a persistent demand for ready-to-move-in units. The figures suggest that buyers are willing to pay a premium for the immediacy and tangibility of completed properties.
Villas represented AED 135,679,104.35 in sales, which could be indicative of a trend towards family-oriented, spacious living or investment in more luxurious property types. The hotel apartments and residences segment closed with AED 17,575,764.00 in transactions, a number that, while modest in comparison to flats and villas, still points to a niche market with steady demand.
Market Implications
The overall higher transaction value in the ready property market suggests a stronger consumer preference for tangible, immediately available properties. However, the robust performance of off-plan flats indicates that investors are also taking a forward-looking approach, banking on future developments in the city's urban landscape.
The data reflects a diversified real estate market in Dubai, catering to various segments from affordable flats to luxurious villas and versatile hotel residences. With the city's ongoing expansion and the influx of international investors and residents, the real estate sector continues to be a cornerstone of Dubai's economic growth.
Conclusion
Dubai's real estate market is showing no signs of slowing down, with both off-plan and ready properties experiencing strong transaction volumes. The market's resilience and attractiveness to a broad range of investors and end-users are evident in these figures. As Dubai continues to evolve as a global city, the real estate sector remains a vital component of its economic landscape, providing opportunities for investment and growth.
Data Source: Dubai Land Department