Reaching For The Sky

Dubai’s housing market has seen a positive tick upward in the first quarter of 2021, with buyer’s sentiment boosted by falling prices and the rollout of Covid-19 vaccines.

During the first three months, the ValuStrat Price Index for residential properties in Dubai was up 0.8% on a quarterly basis, the first time the index had a positive reading since 2014, according to ValuStrat, a Dubai-headquartered international consulting firm.

“A positive trend commenced in the second half of 2019, only cut short by the Covid-19 restrictions last year,” Haider Tuaima, head of real estate research at ValuStrat, said in the report. “Now as we welcomed 2021, that trend has intensified with improved investor confidence, boosting demand, with record number of title deeds registered and a gradual growth towards previous peaks.”

Villas fared better than apartments in the first quarter, as buyers wanted more space and privacy. While villas saw quarterly price growth ranging from 1.8% to 5.4%, depending on the neighbourhood, only half of apartment locations improved in value quarter over quarter, according to the report.

Competitive bidding occurred among some purchasers, especially in villa communities and now also in some of the more sought-after apartment locations, said Declan King, group head of ValuStrat real estate department.

The best performing neighbourhoods included International City, Arabian Ranches, The Meadows, The Lakes and Palm Jumeirah.

“Influence of Covid on housing requirements, and an undersupply in some communities and sub-sectors, are factors as to why this is happening,” he said in the report. “Other reasons may also include a perception that prices had actually over corrected and that perhaps they now represent good value.”

This year, Dubai is expected to deliver 46,316 apartments and 10,563 villas/townhouses. Approximately 7,294 units finished construction during the first quarter, equivalent to more than 12% of total expected supply, according to the report.

Source: mansionglobal.com/