Demand for ready-to-move-in apartments and villas in Dubai has continued to grow relentlessly throughout 2022 due to a combination of a growing population of long-term residents and spiking interest by international HNWIs looking to invest in second homes, making the city’s completed residential stock an internationally attractive property market proposition.
The rise in demand is evidenced through official Dubai Land Department statistics according to which a total of 32,760 sales transactions of ready residential properties took place from January 1 to December 21 this year, a 12 per cent increase compared to last year’s equivalent.
Such is the rush to enter Dubai’s ready real estate ladder, that a ten-minute delay in sending the confirmed offer to the seller of a residential unit can result in losing the property to another buyer, according to Alina Adamco, Head of Sales, at Metropolitan Homes which was recently launched by the Metropolitan Group, to provide the full cycle of real estate services to secondary market sellers and buyers in Dubai.
“Dubai’s property market is witnessing a stronger preference for completed aparments and villas, rather than off-plan properties. Our Group recorded a 300 per cent increase in secondary market transactions during the first half of this year compared to the same period in 2021,” says Adamco.
“Competition for a place in Dubai’s secondary property market is fierce and this is reflected in the bidding war some buyers may get entangled in, as they are forced to increase their offer in the last minute in order to secure the property of their choice,” says Adamco.
The market is fast adapting to the strong demand through the simplification of the transaction process allowing properties to be sold within a 24-hour window since a deal between a seller and a buyer has been agreed.
“The moment the developer has issued the NOC for resale, and both the seller and the buyer are ready for the transaction, the buyer is ready with the manager’s cheque and the seller is ready with the NOC the property transfer can be performed. To make it even easier and faster, the option of online power of attorney is available, whereby the buyer and/or the seller can have the property transferred without being physically present,” she adds.
Despite coming at a higher cost and with no additional incentives compared to off plan properties, Dubai’s ready real estate segment is dominating the market with the segment occupying almost 55% of overall residential real estate transaction volumes.
The current and projected market conditions are in favour of owners of Dubai residential properties if they are thinking to sell or rent their units as demand for ready realty outperforms supply especially in sought-after locations such as the coastal areas: Dubai Marina, Jumeirah Beach Residence, Bluewaters, Beachfront, Palm Jumeirah and Port de la Mer. The Downtown and Business Bay, Dubai Creek and Jumeirah Village Circle are also popular among buyers.
In terms of villas, the top areas of search are Damac Hills, Emirates Living, Dubai Hills, Arabian Ranches 1-2-3 and Villanova.
According to Adamco, properties in Dubai Marina and other coastal areas are very popular for both short and long-term rentals among tourists and residents. Downtown is also preferred by executive clients and certain nationalities with Russians, British and Indians leading the pack. Gated villa communities are also particularly in demand by families who are looking to buy due to lower service charges, high and a steady ROI average of 6-6.5 per cent.
Dubai’s property market is witnessing a stronger preference for completed aparments and villas, rather than off-plan properties. Our Group recorded a 300% increase in secondary market transactions during the first half of this year compared to the same period in 2021.
Dubai’s 2022 ready property transaction value was Dh86 billion, recording a 39.1 percent YoY increase. The value of overall ready property transactions in Dubai would have been even higher were it not for a marked disparity in willingness to sell between the mainstream segment’s owners - who account for the majority of unit supply - and those from the ultraluxury and luxury segments – who are not in rush to sell, neither are they financially motivated.
All indications are that real estate stock is king and owners of Dubai residential property find themselves ideally placed to make the most out of their investment, as it is estimated that the city’s population will rise from today’s 3.5 million to 5.8 million by 2040.
Additionally, the recent expansion of the UAE Golden Visa regulations, residency permits for retirees and the digital nomad trend are likely to attract more investment into real estate in Dubai, as they provide residents with a strong reason to invest in the country and allow non-residents to make UAE their second home.
Motivated sellers should place their trust to well-established real estate brokerage firms who have been in the market for a long time and who have earned the reputation of providing clients with outstanding customer service.
“Sellers should also be looking at the amount of marketing and exposure that the company has, and at the network of clients and industry partners that are cooperating with this company before signing the agreements permitting them to advertise and sell their property,” says Adamco, who notes that RERA is limiting the number of agents who can represent one property owner, down to three agencies/agents.