06 October 2021, Khaleej Times
Dubai recorded 5,762 transactions worth Dh16.2 billion in September, making it the best September on record in the past eight years
Real estate transactions in Dubai crossed the Dh100 billion mark in September due to phenomenal growth in monthly sales, thanks to presence of a good number of international investors in the market.
According to Property Finder, Dubai recorded 5,762 transactions worth Dh16.2 billion in September, making it the best September on record in the past eight years. September also saw the highest value of real estate sold in a single month since December 2013.
“To date, we have over Dh104 billion in sales transaction value which is the highest value since 2017. Mortgage transactions are at an all-time high year-to-date, breaking all records, and the year hasn’t ended yet,” said Lynnette Sacchetto, director of research and data at Property Finder.
Property Finder data showed that total sale transactions in the first nine months reached 43,299 worth Dh104.3 billion, up by 45 per cent as compared to last year as a whole.
“Many end-users, who have been in the market to purchase, have been priced out of the segments they have been looking in, therefore we have seen recent trends where end-users have decided to renovate, upgrade and extend their current properties instead. This has caused a shortage in the market of quality contractors with most booked until mid-2022,” said Sacchetto.
Mrs Dounia Fadi, chief operating officer of Berkshire Hathaway HomeServices Gulf Properties, said it’s no surprise to see that Dubai’s real estate transactions exceeded the Dh100 billion mark ahead of Expo 2020.
“From fourth quarter of 2020 and beginning of 2021, we have seen the market steadily rising in line with the UAE’s efforts to combat the effects of the Covid-19 pandemic. With Expo 2020 expecting to attract millions of visitors from all over the world, Dubai property prices after the event are expected to stabilise as potential short-term visitors for the event could potentially turn into residents in the long-run,” she said.
“Moreover, the investment prospects associated with Expo 2020 and introduction of regulatory reforms aimed at attracting foreign investors have helped to boost the local real estate market and furthermore provide an optimistic outlook of the future for developers,” said Fadi.
Investor confidence returns
Rizwan Sajan, chairman and founder Danube Group, said this strong transactional activity in 2021 reflects that there are a good number of international investors in the market.
“The investor confidence comes from the effective handling of the Covid-19 pandemic by the UAE government that makes the UAE and Dubai as the safest place to live, work and do business. The result is evident. Good times are here, once again,” said Sajan.
Expo boosts sentiments
Imran Farooq, CEO of Samana Developers, said Expo 2020 will give a further 15 to 30 per cent push to Dubai’s real estate transactions as inbound passenger count, especially for Expo, speeds up in coming days.
“The positive outlook will be backed up further between November and March when fine weather conditions in Dubai attract tourists to Dubai. Other factors that are supporting Dubai real estate include the UAE’s perfect handling of the pandemic, setting up isolation centres, increasing hospital beds for Covid-19 patients and rolling out one of the fastest moving vaccination programmes in the world,” said Farooq.
In addition, initiatives like long-term visas for property investors and the UAE citizenship have created a sense of belonging among expatriates and is a major attraction for real estate investor. All are factored around boosting the number of the end-user buyers in Dubai.
Off-plan sales transactions
In September 2021, 56 per cent of all transactions were for secondary and ready properties and 44 per cent were for off-plan properties. The off-plan market transacted 2,530 properties worth a total of Dh5.1 billion. This is the highest value of off-plan sales transactions the Dubai market has seen in over eight years. The secondary market transacted 3,232 transactions worth Dh11.1 billion.
The median price for secondary apartments has increased by 41 per cent over the past year and has increased by 20 per cent for secondary villa and townhouses. The median price for off-plan apartments has increased by more than 15 per cent while villa and townhouses in the off-plan segment have increased by over 10 per cent.
“Recent trend is in the villa and townhouse segment, where many buyers are being priced out of the bedroom types they are looking for, therefore having to move to the next level below in bedrooms. This has been another reason why prices continue to rise and stay strong in the villa and townhouse segment as the demand is still very prevalent,” said Sacchetto.