DUBAI: Confidence is returning to Dubai’s residential property market as both the volume and value of transaction jumped in the first half of the year, according to SmartCrowd’s inaugural Dubai Residential Property Report.
A 74 percent year-on-year increase in transaction volume in the six months to June was bettered by a 113 percent jump in the value of deals in the period, the report showed, suggesting prices are rising.
“Government policies to introduce attractive visa and residency schemes for investors and professionals are starting to bear fruit, incentives to support entrepreneurs and the private sector, proactive safety measures to combat COVID-19, and visionary thinking for events such as EXPO 2020, have underpinned investor appetite for real estate in Dubai,” said SmartCrowd CEO and co-Founder Siddiq Farid.
“While nothing is guaranteed, we expect that confidence to continue to grow for the remainder of the year,” the DFSA-regulated property investment and technology platform CEO said.
About 72 percent of deals were for completed homes, against 28 percent for off-plan.
High demand for completed properties helped drive per square foot prices for available properties up by 10 percent year on year, while the average off-plan price per square foot dipped by 3.4 percent.
The decline can be attributed to new supply focusing on more affordable housing and thus putting downward pressure on average prices, according to the report.
“With a lack of new supply in Dubai’s most popular areas and pricing at levels last seen in 2011, there is positive sentiment in the market and a resultant boost in demand for existing properties,” Farid said.
Jumeirah Lakes Towers (JLT) saw the highest increase in transaction volume of 262 percent while Palm Jumeirah showed a 34 percent gain in the value of property transactions and a 221 percent increase in volume of transactions.
The average sales price for completed villas in Dubai increased by 19.3 percent from the first half of 2020 to 905.1 dirhams ($246.45) per square foot in the first half of 2021, said SmartCrowd, which attributed the gain to people’s preferences shifting to larger living spaces, with room for outdoor activities.
Similarly, off-plan sales prices of villas have grown by 9.3 percent to 748.4 dirhams per square foot in first half of 2021.
Completed apartments’ sales prices increased by 8.7 percent year on year, while off-plan apartment prices dropped 9.5 percent in the same period.
“Investor sentiment is returning, and personal finances are beginning to recover too,” said Farid. “While investing in an entire property in Dubai might still be out of reach for some, investment via crowdfunding allows people to take a fraction of a property from as little as 2,000 dirhams. Crowdfunding in real estate is an accelerating trend and has the potential to be a major catalyst for the region’s property market.”