14 July 2023, Gulf News
Dubai: The property market in Dubai has shown no signs of slowing down as prices continue to skyrocket, according to the H1-2023 Dubai Property Market Report released by Bayut. The report highlights significant increases in rents, with key areas experiencing a surge of up to 70 per cent. Additionally, sales transactions in the first-half of 2023 reached a whopping Dh170 billion.
This continued boom in property prices has been fueled by strong demand among local and overseas property seekers for luxury and affordable properties in Dubai.
The report reveals that the strong demand for luxury and affordable properties in Dubai has driven the surge in property prices. Popular districts have recorded price increases ranging from 1 per cent to 17 per cent for both villas and apartments.
Jumeirah Village Circle (JVC), Jumeirah Lake Towers, DAMAC Hills 2, and Al Furjan have emerged as top choices for investors seeking affordable properties. On the other hand, Dubai Marina, Downtown Dubai, Arabian Ranches, and Dubai Hills Estate have attracted high net-worth investors in search of luxury properties.
Rental prices have also experienced significant upticks, with affordable apartments in popular districts witnessing increases of up to 17 per cent. Luxury apartment rents have surged by as much as 32 per cent, while affordable villas have seen rent hikes of up to 50 per cent. Luxury villa rents have spiked by an astounding 70 per cent.
The report further highlights the most sought-after areas for property seekers. Jumeirah Village Circle and Bur Dubai are preferred for affordable apartments, while DAMAC Hills 2 and Mirdif are popular choices for villas. Dubai Marina and Business Bay remain top picks for luxury apartment rentals, with Dubai Hills Estate and Al Barsha attracting tenants seeking high-end villas.
The Dubai Land Department’s data reveals a staggering 60,927 residential property sales transactions worth Dh170 billion during H1-2023.
According to the Bayut report average sales price for expensive villas in Dubai has continued to increase in the most prominent neighbourhoods during H1-2023.
Arabian Ranches has been the top choice for buyers in search of buy-to-let luxury villas in Dubai, during the period. The sales price-per-square-foot for villas in Arabian Ranches has averaged at Dh1,316, following an uptick of 2.81 per cent. Houses in Dubai Hills Estate have also appealed to high-net-worth buyers. The average price-per-square-foot for villas in Dubai Hills Estate has recorded an uptick of 11.9 per cent, to stand at Dh1,833.
Buyers and investors have also shown interest in the upscale villas available in DAMAC Hills, Palm Jumeirah and Jumeirah Park. Prices in these areas have recorded upticks of up to 17 per cent. The most prominent movement in prices was observed in Palm Jumeirah, which could be consequent to the increased demand in the area.
“We can also really see the supply vs demand dynamics playing out strongly in the rental market, with traditionally popular areas constantly being outpriced because of the supply crunch,” said Haider Ali Khan, the CEO of Bayut and the Head of Dubizzle Group MENA. “The constant increase in rental prices has also prompted more people to take the plunge into homeownership, so the money they are allocating towards real estate ends up creating an asset in the long term.”
Demand for apartments
For affordable rental flats in Dubai, potential tenants have continued to prefer Jumeirah Village Circle in H1-2023.
The rental costs for apartments in JVC have increased by 15 per cent to 18 per cent during H1-2023. On average, studio flats have been rented out for Dh44,000, whereas 1-bedroom and 2-bedroom flats have been priced at Dh63,000 and Dh88,000, respectively.
Potential tenants have also gravitated towards the reasonably-priced flats in Bur Dubai, Al Nahda, Deira and International City. Asking rents for apartments have generally appreciated by 6 per cent to 16 per cent. The most prominent uptick in asking rents has been observed in Al Nahda, which may be consequent to the increased demand for affordable properties in the area.