Real estate market in Dubai in the fall of 2022: statistics, developments and prospects. Who buys a luxury property in Dubai? New off-plan projects in Dubai. How is the market evolving?
The real estate market in Dubai is constantly changing. Just yesterday everyone was looking apartments in Dubai Creek Harbor and today the hottest trend is a new off-plan project. Let’s take a look at the current state of the market and possible future trends.
Dubai is a leader in international investment
Residential real estate in the UAE continues to be a priority for investment in the international market. The main reasons contributing to the increase in demand, experts attribute the numerous government initiatives and the high level of income.
Reports from consultancy firms show growth in all segments of the housing market. And this despite the fact that over the last few months, the metropolitan real estate market has faced certain obstacles: for example, the strengthening of the dollar on the foreign exchange market and the rise in interest rates.
According to the DLD, in the first 6 months of this year, 60% more real estate transactions were made than in the same period last year. Of particular note is the overall increase in value, which was recorded at around 85%.
Another trend that predicts that a large number of expatriates will settle in the emirate is geopolitical instability, inflation and rising taxes. And given that the government continues to reform the employment system, providing qualified professionals with the fairest conditions for moving, in the near future, investments in real estate will become even more profitable.
Who buys a luxury property in Dubai
Real estate specialists have painted a portrait of the buyer of an ultra-luxury property in the city. The vast majority of buyers are international investors, representatives of large business communities, owners and shareholders of leading holding companies and transnational corporations.
The main distinguishing feature of the high-end real estate sector is the use of cash. Most buyers buy properties using instant cash payments. There are small exceptions where buyers use special payment plans, but they pay for all transactions in a very short time.
It is also worth noting the fact that most buyers of ultra-luxury homes make a purchase not for investment, but for their personal life.
Despite the relative scarcity of the super premium real estate segment, developers are trying to advertise new projects that meet the demands of modern buyers. And, judging by the announcements, the developers have very ambitious plans to earn the trust of the target audience.
New off-plan projects in Dubai
Developers are working hard to meet the growing demand for housing. If a few years ago experts expected to overcome obstacles due to the COVID-19 pandemic, today demand exceeds all previously known indicators.
Indeed, today we are witnessing a significant increase in the number of off-plan projects. Developers are particularly focused on developing new areas, including:
- Dubai South,
- Dubai Hills,
- City MBR.
More and more international investors are paying attention to real estate. This investment asset, unlike many others, gives a stable income, has a very low risk of depreciation. And when it comes to location for buying real estate, the city has undeniable advantages in the form of additional advantages for investors, a high level of security and an excellent business climate.
It is also worth considering the number of projects announced by developers: a sharp increase in new projects in different segments of the real estate market makes it possible to fully satisfy the needs of potential investors and buyers.
How the market is changing
The housing market in Dubai, as well as the needs of potential buyers and investors, is constantly changing. Developers try to implement projects, anticipating the desires of consumers. However, the situation in the market is changing very rapidly, which is confirmed by statistics and reports.
- Particularly high demand for apartments has been recorded in the Jumeirah region. Here, the average level of sales per square meter stopped at around 6,112 USD. Regarding the villa sector, Palm Jumeirah showed the highest demand: here, the average price level per square meter was 9,892 USD.
- Over the past year, the average rent has increased by more than 1/5: by 21.7%. At the same time, the rent depends on the type of real estate: for example, the cost of renting a villa increases much faster than the cost of renting apartments.
These statistics indicate a steady increase in demand for properties. And this applies to investment properties and homes purchased for personal residence. Additionally, many buyers see the city as a promising place to live in the future, which is a great investment strategy. After purchase, the property can be rented out and, if necessary, after receiving a residence permit, move directly to Dubai.
Dubai breaks a new record
Almost every month, the real estate sector in Dubai breaks new records. One of the latest records was a deal to sell an apartment in an upscale residential complex. It is reported that the cost of this property was 632 million AED, which is equivalent to 172 million USD.
Last week’s data provided by the DLD shows a total of 2,509 transactions worth AED10.9 billion, or $2.97 billion. During the same period, 263 plots were also sold for a total value of AED 1.46 billion.
It is worth noting the most popular area where specialists were able to register the most transactions:
- In just one week, 130 transactions were made in the Al Hebiah Fifth area. Their total cost was 328 million dirhams AED.
- The second place was occupied by the Jebel Al First region, where 32 transactions were concluded for a total of AED 92 million.
- The top three is completed by Al Yufrah 2 district, where experts have registered 23 transactions with a total value of AED 28 million.
The report also indicates the number of mortgages that have been issued for the purchase of a property. Within a week, UAE banking structures funded buyers for AED5.09 billion, while the biggest transaction was a AED96 million loan issued for the purchase of land.
Real estate agency in Dubai
If you are considering buying a property in Dubai, please contact the specialists in Ax Capital real estate agency. Their advisers will tell you about all the characteristics of the market and help you choose the best options for investing in housing.