Muzaffar Rizvi/DubaiFiled on September 11, 2019/khaleejtimes
Dubai’s real estate sector is coming out of the woods as residential sales transactions hit a 4-year high during the summer season this year, the latest data shows.
Dubai home sales have performed well, both in terms of volume and value, during June, July and August this year, as investors and end-users took the advantage of price correction and became a property-owner in one of the best cities of the world.
Residential sales transactions posted a 33.46 per cent year-on-year growth as Dubai witnessed 8,833 deals, compared to 6,618 in the corresponding period last year, according to statistics by Data Finder, a data platform under the Property Finder Group. The emirate recorded 8,694 and 7,066 residential deals in similar periods of 2017 and 2016, respectively.
Dubai home sales also hit a 4-year peak in terms of value, as deals worth Dh14.94 billion were recorded in the 2019 summer season, compared to Dh12.58 billion in the same period last year, reflecting an increase of 14.94 per cent. The emirate posted Dh13.25 billion and Dh12.75 billion home sales in 2017 and 2016, respectively.
Analysts and experts said that the property sector has shown solid signs of recovery at an appropriate time when the countdown for the Dubai Expo 2020, a growth driver for the real estate industry, will start next month. They are of the opinion that Dubai continues to attract investors while price correction, attractive bargains and long-term payment options influence several end-users to purchase property in the city.
It’s a buyer market
“We believe it is a great time to buy property in Dubai; the price corrections and the proactive reforms undertaken by the government have made Dubai’s real estate market conducive for investors and buyers,” said Niall McLoughlin, senior vice-president, Damac Properties.
Referring to the recent launch of the new real estate committee, which aims to create a more centralised and well-planned strategy to manage the city’s supply and demand dynamics, he said that it will further boost buyers’ sentiment.
Haider Tuaima, head of Real Estate Research at ValuStrat, said that it is a buyer’s market in Dubai, and that it has been for quite a while now.
“Judging the performance of the Dubai Land Department’s transaction volumes demonstrates that savvy investors answered this question already. In the current softening market, ready homes asking prices are negotiated downwards to mitigate further short-term declines,” Tuaima said.
And for off-plan properties, he said that developers have widened investor options by creatively offering easy payment plans.
“The market today is undoubtedly biased towards the buyers,” he said.
Lynnette Abad, director of Research and Data, Property Finder, said that prices today are very attractive and that now is a good time to buy and negotiate a very attractive deal.
“This year especially, we have seen many end-users get on the property ladder, particularly consumers who have been sitting on the fence deciding when was a good time to buy. This, coupled with a large amount of completed supply in the affordable segment, has made buying achievable,” she said.
Off-plan still dominates
Experts said that Dubai property staged a solid recovery as both the off-plan and ready categories of the housing market have performed well in summer season this year. These include the sales of apartments, hotel apartments, villas, townhouses and residential land plots.
The Dubai ready, secondary housing market has had its best run in the summer months this year, compared to the previous three years. It registered a strong 20.43 per cent year-on-year growth by posting 3,801 sales transactions in the summer of 2019, as against 3,156 deals in similar period last year. The emirate registered 2,596 deals in similar category in 2017 and 2,661 transactions in 2016, according to Data Finder statistics.
In terms of value, the ready, secondary housing market posted Dh7.07 billion transactions in the summer of 2019 compared to Dh7.7 billion in similar period last year.
Off-plan market still accounted for the majority of transactions in Dubai, accounting for 5,032 deals in the summer months of 2019. This compares with 3,462 off-plan transactions in the summer of 2018, 6,098 such deals in 2017 and 4,405 deals in 2016.
Off-plan housing market clocked sales worth Dh7.3 billion in June, July and August this year compared to Dh8.5 billion in the corresponding period last year. In comparison, off-plan homes worth Dh7.9 billion were sold in the summer of 2016 and similar units valued at Dh4.88 million exchanged hands in the summer months of 2018.
“Off-plan is still a very lucrative investment in Dubai with attractive pricing and developer incentives such as enticing payment plans and post-handover payment plans,” Abad added.