The real estate industry in Dubai has been on a high ride since last year with sales going over the roof and the demand going beyond supply.
In order to meet the market demands, developers are looking at various options for people looking to own or rent properties around Dubai. Sought-after areas like Palm Jumeirah, Emirates Hills, Jumeirah Bay Island, etc. are being eyed by high-net-worth individuals and investors.
Dubai’s Economic Sector Is Growing
After the Covid-19 crisis, Dubai made a strong comeback boosting its economy in multiple ways by opening up its tourist sector; improving relations with other nations in terms of trade and investments; hosting an array of global events including the Dubai Expo 2020; creating new projects to improve infrastructure and sustainability throughout different sectors in Dubai; focusing on the quality of life and individual growth, etc.
All these led to a fertile economic environment that attracted people from all around the world to make Dubai a destination for work and investment. The introduction of liberal Visa options like the Golden Visa also made it easier for people to choose Dubai over other destinations.
According to the estimates of Realiste, a PropTech company, the Dubai real estate sector is set to have a 46 percent growth in the year 2023. As per the reports, Dubai was among the few beneficiaries of a worldwide geopolitical crisis as it saw the influx of a huge percentage of private investments from Russian entrepreneurs, high-level professionals, and investors.
Farmhouses are one of the most sought-after properties that people would like to invest in and for these kinds of properties, The Valley situated on the Al-Ain road nearby Sevens Stadium offers great deals by Emaar, a multinational real estate developer starting at Dh 5 million onwards.
The Villas that are offered here have four and five-bedroom options and they are under construction. Dsight, an analytics agency, has reported that around sixteen percent of Russian companies and entrepreneurs have moved to UAE and Dubai because of the economic instability created by the Russian-Ukrainian war.
Another reason for the real estate sector boom was this year’s FIFA World cup that took place in Qatar. After Qatar, Dubai benefitted the most because of its stronghold in the areas of tourism and finance.
The property rates at prime spots like Palm Jumeirah shot up incessantly because of the high demand and low supply rate. The average pricing around this area was AED 3.95 million and this is expected to have a relative growth of 5 percent in 2023.
Another property that saw a stark increase in its demand was Dubai Hills or Hadeeq Sheikh Mohammed bin Rashid Part 2. This area was mainly preferred by families who were looking for a change from the usual resident areas near canals or bays.
The Dubai Hills are known for their plush green surroundings and their demand grew by almost 53 percent with the prices averaging around AED 1,600,000. The Knight Frank Prime Global Cities Index shows that Dubai had the fastest increase in prime property prices in the year 2022 with a whopping 88.8 percent.
The Dubai Land Department said that the second quarter of 2022 witnessed the highest quarterly sales volume in the previous decade by recording a total of 22,504 transactions valued at AED 59.154 billion.
Damac properties launched their Lagoons project in 2023 which is being built around the theme of water elements. The Tilal Al Ghaf group has been invested in the Lanai Islands, a series of ultra-luxury island estates targeted at the super-rich.
These mansions by the Majid Al Futtaim Communities carry an average price tag of AED 18 million. An estate agent quipped that most people prefer waterfront properties in Dubai usually by the sea and nowadays Dubai offers in-land waterfront destinations too which have been selling like hotcakes in the past few months. The main reason for this is the wide pricing options starting from a range of AED 1.5 million upwards.
The Realiste AI data predicts that the areas that were underutilized last year will see huge growth this year. These areas haven’t yet their full price potential and this can lead to a sudden increase in demand for these properties.
The Jumeirah Village Triangle, which showed a 62 percent growth in 2022 is estimated to increase by another 29 percent this year. The overall estimates of the properties around Dubai show an average increase of ten to fifteen percent with consistent upward growth in the real estate sector.
The developers are currently looking at more off-plan options as demand is rising and the trend in the coming two months shall dictate the further course of action. Other than the demand in the real estate sector, various other factors can influence the decision of a developer to invest such as global recession risks, material costs, currency value fluctuations, internal cash flow, etc.