Dubai’s real estate sector has all the ingredients necessary for its growth thanks to timely measures introduced by its government to offset the impact of a slowdown in the global economy.
Ali Sajwani, General Manager of Operations at Damac Properties said, “For developers, it is vital to align their strategies to the long-term aspirations of the city. We need to build for the future, and that takes a deep understanding of what customers and investors are looking for.”
In 2019, there were 68 real estate projects launched in Dubai which shows that it is slowing down than previous years. But there is a 33 percent increase in sales compared to previous years, a proof of its continuing demand among the investors.
The best way to define Dubai’s real estate sector is that industry is maturing. Considering the cyclical nature of the industry, the correction in prices has further amplified the market’s appeal to investors with more than half the real estate transactions in the first five months of 2019 coming from new investors.
The government is making an effort to transform Dubai into a long-term destination. As a result, many people’s dream of owning a house in Dubai will become a reality.
Dubai economy is expected to grow by 48 billion dollars as a result of Expo 2020 Dubai. The event is expected to attract 20-25 million visitors, and will create 300,000 job opportunities. Expo 2020 will work as a catalyst for the growth of Dubai real estate. With a projected 3.5% growth in GDP, Dubai will further appeal to high net worth individuals and global businesses as a stable market.
The market is oversupplied for the moment and is witnessing a lot of encouraging activity. Sajwani said, “We must remember that we are approaching the end of a softer real estate market cycle. What the industry should now focus on is creating the right kind of supply that is aligned with what investors and buyers are looking for. The city saw a sharp increase in real estate transactions and investments in the first five months of 2019 driven by competitive product offering and positive initiatives by the government such as the introduction of long-term visas for professionals and investors.”
In 2019 transactions in Dubai real estate were driven by low cost properties. From January until September 30 this year, Dubai clocked in 18,858 transactions for properties worth upto $408,319. In these transactions, the secondary market registered 7,869 deals and off-plan sales registered 10,989 deals.
In the last year, 17,009 transactions of properties were worth upto $408,319, which shows that this year the average price of the properties decreased driving the sale upwards. Now, Dubai is not just a playground for the wealthy but it is now also affordable for the budget-conscious buyers.
Two percent of Dubai housing is now short-term rental properties which is a very high percentage compared to other global cities. There are currently 6100 rental properties available in Dubai.
New visa regulations, such as 10-year golden visa, has an impact on the investment in the country. Vice Chairman of Haqson Groups, Emad Haq says, “When investors are assured their investment is safe with stable rental returns, the market will thrive.”
The most luxurious life in Dubai is now affordable. This year the rate of property has decreased and property transactions have increased. The luxury sales specialist at Luxhabitat, Michelle Liddiard said, “On the Palm Jumeirah, property transactions for the value of Dh10 million-plus have doubled this year”. Many people are now shifting to the most prestigious locations which were beyond their reach in previous years.
COO of SPF Realty, Kalpesh Sampat said, “It is essential to control the length of the offer and not increase the risk for the buyer, luring them to buy beyond their means or budget by offering such extended plans.”