Property prices in Dubai’s popular areas continued to become more competitive throughout 2019 compared to 2018, resulting in both the number and value of property transactions increasing for property sales in Dubai, a report said.
Popular freehold communities such as Palm Jumeirah, Dubai Marina, Downtown Dubai and Jumeirah Village Circle dominate the sales segment in the secondary market, added the 2019 End of Year report from Bayut, a leading property portal in the UAE.
In the primary segment, areas which are easily accessible from the Expo 2020 site such as Dubai South are also garnering interest from potential buyers and investors while upscale neighbourhoods such as Mohammed Bin Rashid (MBR) City and Dubai Hills Estate are still popular with those looking for off-plan developments in premium communities with more affordable payment plans.
Based on the comparison of sales prices from 2019 to 2018, there are declines in asking prices across the board for both apartments and villas. Luxury waterfront areas such as Dubai Marina and Palm Jumeirah have attracted interest from buyers looking at purchasing ready units, while recently handed over communities such as DAMAC Hills and Dubai Hills Estate are also making their mark in the list of top ten most popular areas to buy real estate in Dubai.
Throughout 2019, Dubai Marina has held on to its title as the most popular area for apartment sales, while Palm Jumeirah continues to attract the highest number of buyers and investors for villas. The price per square foot in Dubai Marina has remained affordable in 2019, reducing by 11.8 per cent from Dh1,502 ($409) in 2018 to Dh1,326 in 2019. This has also contributed to the increased transactions in the area which saw sales worth Dh8.07 B in 2019 as opposed to the Dh5.06 B it generated in 2018 as per DLD.
When it comes to the average sales price per sq ft for apartments, the luxury area of Palm Jumeirah saw a decline of 16.6 per cent from Dh1,671 in 2018 to Dh1,394 in 2019.
Areas such as Business Bay and JVC have remained fairly stable with marginal declines in price per square foot of under 5 per cent.
When it comes to villa sales, the area where prices have become considerably more affordable is JVC, with the price per square foot lowering by 13.8 per cent to Dh599 in 2019, compared to Dh695 in 2018. This can be attributed to a number of factors, including the increased supply of units in the area thanks to recent off-plan handovers and the emergence of neighbourhoods such as Al Furjan and Barsha South which offer similar facilities in the vicinity.
In terms of ROI, International City offers the highest ROI of 9.4 per cent for apartments, while the affordable community of Jumeirah Village Circle offers rental yields of 6.5 per cent for villas.
Bayut also reports that established areas like Al Nahda, Dubai Marina, Mirdif, and Jumeirah continue to lead the rental market in Dubai. Conditions have remained favourable for tenants with plenty of exciting opportunities for those looking to move homes. Whether it’s to upgrade to more upscale areas at lower prices or negotiate lower rents in their current homes, the price correction in Dubai’s market is aiding tenants to leverage market conditions and get the best possible deals.
Staying in line with the trends seen across 2019, Al Nahda and Dubai Marina have remained popular among potential tenants looking to rent apartments, while Mirdif takes the lead with those interested in villa rentals. Prices for all units in Al Nahda have gone down by approximately 13 per cent - 16 per cent, while Dubai Marina has faced decreases between 8 per cent -13 per cent on average. Most of the other popular areas for apartment rentals such as JVC, Bur Dubai and Deira also experienced decreases between 8 per cent -14 per cent in 2019 compared to the prices in 2018.
When it comes to villa rentals, apart from the consistently popular areas such as Mirdif, Jumeirah, Al Barsha and Arabian Ranches, reasonably priced communities such as DAMAC Hills, Dubailand and Reem are also receiving attention from potential tenants. Prices have become more affordable across the board for villa units in these neighbourhoods, with most areas seeing declines between 8 per cent - 16 per cent.
Along with Dubai South and Akoya Oxygen which dominate off-plan sales, Bayut’s data also shows interest is picking up in upscale neighbourhoods such as Downtown Dubai, MBR City and Dubai Hills Estate. Developing areas such as JVC, Dubai Sports City and Town Square are also popular thanks to competitive payment plans.
The data released by the Dubai Land Department up to November 2019 also shows that transactions were higher in the off-plan segment in 2019 compared to 2018. A total of 14,113 transactions were recorded for the off-plan segment in 2019 while the number of transactions in the ready property market came up to 13,480. While the numbers are fairly close, there is a clear leaning towards the primary off-plan segment in the Dubai real estate market.
Haider Ali Khan, CEO of Bayut, said: “We can expect this trend to continue into 2020 as well. It is certainly going to be another year of many firsts for Dubai. We will be seeing a lot of new initiatives before Expo 2020 launches in October.”
“ Construction will be completed for a lot of projects which have been developed specifically for the event, whether it’s for residential, commercial or tourism purposes. This will not only increase inventory, but it will also provide tenants and buyers with exciting alternatives that they can explore.”
“This is also the year where we will see the market mature as a result of key regulations introduced in 2019, including reduced fees for early settlement of mortgages and the Higher Committee for Real Estate Planning. It will be interesting to see how property prices will evolve in the face of these new conditions.
“Overall, we can be optimistic about sustained interest in the Dubai property market. The world is coming to Dubai in 2020, and conditions are ideal for increased transactions for all stakeholders. Healthy ROIs will invite more investors, and innovative payment solutions will help tenants to consider transitioning into homeowners!” he added. – TradeArabia News Service