Dubai Property Market Summary - November 2021

We’ve had the latest report from the Dubai Land Department summarising the activity across the Dubai market, for the month of October, with a focus on the primary and secondary residential property markets.

 
Today, I’ve broken down the key points and then advise how you can use this information to benefit your investment strategy. 
 
So, here we go – the headlines…
 
– October in Dubai was the busiest October for the past 8 years, the volume total was 12.12 billion AED across 5,352 transacitons. 
 
– The value for 2021 now stands at 177.44 billion AED, totalling 48,651 transactions. The 10 months we’ve seen to date is already 63.4% great than 2020. 
 
– The split in terms of the secondary and primary market is about 60/40. This means most of the properties involved in transactions were homes that are built and operational, the 40% relates to developments and villas currently under construction e.g. off-plan, this segment accounted for 2,133 properties. 
 
– Property Finder data (the largest real estate portal in the UAE) leads us to believe the most popular areas for apartments specifically were as follows – Dubai Marina, Business Bay, JVC, Downtown Dubai and JLT. For Villas/Townhouses the following areas ranked highly – Damac Hills 2, The Springs, Arabian Ranches and Dubai Hills Estate.
 
What does this mean for you?
 
Currently, there is all-time high demand in the Dubai real estate market from buyers, this is putting upward pressure on pricing as the competition for property is high, if an owner sees high levels of interest, these buyers will compete which will drive up values. Agents, then consequently advise new sellers of this activity and the cycle continues. 
 
Developer/off-plan/primary sales are slightly less cyclical (e.g. less subject to ups and downs) and generally, developers don’t chop and change complex pricing models in short timeframes. However, they do over longer periods of time and when new projects are launched.
 
There are major master communities in Dubai that were launched over the past 1-2 years, this means they were launched when the market was softer and the demand wasn’t there whilst COVID-19 was having a larger impact on global market demand. The way the UAE has handled the pandemic has meant the economy and thus housing market has bounced back at a significantly faster pace than comparable cities, and attention and buyer confidence has returned quicker. In my opinion, primary/off-plan projects haven’t yet adjusted to this increase in buyer activity which is likely to be with us for a few years yet, thus it creates an opportunity to buy off-plan at prices that don’t yet reflect the high levels of activity in the market, however, for new launches in the next 12-18 months, I believe developers will offer fewer incentives and aim to recoup what they’ve potentially lost since March 2020, e.g. they are going to increase prices. 
 
View the full Residential Sales Price Index from the Dubai Land Department here.
 
Should you have any questions regarding purchasing property in Dubai, particularly for investment purposes, then please reach out to the team via info@masarcapital.ae.
 
Author:
 
Nick Hyland
 

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