The last few months of 2020 have been record-breaking in the Dubai property market. As a result of the Corona pandemic, more and more families are looking to own their own home, particularly a detached house, which explains the impressive increase in property transactions of over 160 percent year-on-year.
Events such as the announcement of a retirement visa, as well as the normalisation of relations with Israel, further boosts investor confidence in Dubai. This is already reflected in market prices.
The real estate market in Dubai has largely stabilized in the last three months - in the more attractive residential areas there has even been an increase in prices. Most notably in the villa market, a constant monthly price increase has been reported over the last six months. The trend towards buying a house instead of an apartment is therefore continuing.
Only in the off-plan market no increase in real estate transactions could be observed. The reasons for this are that, on the one hand, fewer new construction projects have been started and, on the other hand, 'ready-to-move-in' properties are simply preferred at the moment. Due to the limited supply of new construction projects, a demand overhang is slowly beginning to make itself felt. We were able to experience this ourselves - apartments disappeared 'overnight' from the availability lists or were reserved.
Price development of real estate prices in Dubai since January 2008 until January 2021
Our assessment of the situation
Over five million people have already been vaccinated against the Corona virus in the UAE/Dubai. This makes the UAE second in the world in terms of vaccination rate per million population. Everyday life is returning and many expats are working again in their familiar environments, be it in the financial district or in one of the many free trade zones. As a consequence of the lockdown, there is clearly more emphasis on home, or rather living. In addition, we are seeing an increasing desire for a 'second-home'. Demand is coming mainly from Europe and Russia.
We therefore venture a continued positive outlook with regard to real estate demand in Dubai. Only the situational flight regulations and quarantine lists are slowing down the pace at best, but not the general demand - on the contrary, the quarantine lists and the European lockdown bans are having a positive effect on Dubai, as it is one of the very few holiday destinations that can be visited and will probably remain so for a few more months.
Attractive properties (location / price) are currently finding buyers quickly. In terms of price, Dubai can be considered 'fair' and accordingly the prices per square metre are significantly lower than European prices. Conclusion for the real estate investor: There are still attractive properties at fair prices for short-termed buyers.