Dubai sees off-plan sales boom ahead of Expo 2020
DUBAI: Dubai’s off-plan realty market has bounced back to 2019 level, and continues to gain momentum, underscoring the soaring investors’ confidence in the new boom cycle, Khaleej Times quoted data revealed by a leading property portal.
In 2021, the off-plan market has been thriving since the beginning of the year. Developers are now starting to launch new villa/townhouse communities mostly in the suburban parts of Dubai such as Dubai land and Dubai South and they are selling out quickly. Compared to July 2021, the total value for off-plan is up 44 per cent and volume is up by 46 per cent, says a report released by Property Finder.
In August 2021 specifically, Dubai’s off-plan market saw 2,599 sales transactions worth Dh4.95 billion, the highest value recorded in a month for off-plan properties since December 2013. The number of deals is also the highest off-plan transactions in a calendar month since November 2019, said the report.
“During the pandemic last year, the off-plan market significantly declined. The average was about 30 per cent of properties sold in the off-plan segment. Today, we have bounced back to 2019 ratios where secondary and off-plan segments are almost 50/50. This is a clear indication that investors are coming back into the market due to their confidence in the future of Dubai,” said Lynnette Sacchetto, director of Research and Data for Property Finder.
Most sought-after areas for off-plan villa/townhouses transactions were Arabian Ranches-3 (187 units) followed by Villanova (157), Tilal al Ghaf (79), Dubai South (58) and Mohammed bin Rashid City (16). For off-plan apartment sales transactions, Dubai Harbour (260 units) had the most sales followed by Mohammed bin Rashid City (239), Business Bay (219), Jumeirah Village Circle(171) and Jumeirah Lakes Towers (137).
Sacchetto said it is not only the transactions that have increased but the buyer appetite for higher valued units has also gone up.
The average transaction price for an off-plan property year-on-year has increased by 53 per cent from Dh1.246 million in August 2020 to Dh 1.905 million in August 2021.
“The median price for off-plan apartment sales transactions in August 2020 was Dh745,500. The price has increased year-on-year by 48 per cent to Dh1.1 million. We now see a 12 per cent increase in the median price for off-plan villa/townhouses sales transactions as they increased from Dh1.622 million in August 2020 to Dh1.818 million in August 2021,” said Sacchetto.
“With the Expo less than two weeks away, I believe the off-plan market will continue to thrive. Looking at completed supply in 2021 as of September, we had a total of a little over 34,000 units completed. In the apartment sector, over 26,000 units were completed and for villa/townhouses over 6,000 units. Now the question is, will there be enough stock available to sell in the off-plan market to fulfill investor demand, especially with foreign investors coming in over the next six months for Expo2020,” Sacchetto said.
According to proprietary Property Finder data, top areas in off-plan demand in August 2021 for villa/townhouses were Dubai Hills Estate, Arabian Ranches, Palm Jumeirah, Damac Hills 2 and Mohammed bin Rashid City. For apartments, as always Dubai Marina stands out as the top area for demand followed by Downtown Dubai, Palm Jumeirah, Business Bay and Jumeirah Village Circle.
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