Dubai’s real estate market will post more than 100 per cent growth in the transaction value this year, as investors reposed trust in the emirate’s consistent economic policies, successful strategy to handle the Covid-19 pandemic, visa reforms, and the recent liberalisation of the business licensing regime, experts say.
Analysts, industry specialists, and top executives, said that the emirate is expected to record property sales transactions worth over Dh150 billion this year, compared to Dh72.49 billion in 2020.
Referring to the latest data released by the Dubai Land Department, they said that the emirate has already registered sales transactions worth Dh142.5 billion through more than 57,500 deals by mid December.
A total of 35,434 transactions worth Dh72.49 billion were registered last year.
Return to healthy growth
Rizwan Sajan, founder and chairman of Danube Group, said that the real estate sector in Dubai saw one of the best years in its history in 2021. It was not only the year of full recovery from the Covid-19 pandemic, but also a year of return to healthy and sustained growth.
“The fast recovery from the pandemic, and healthy growth, reflects the long-term sustainability of the real estate sector of Dubai, and also shows its degree of maturity. The question one would ask is how can an industry record such a high growth in one year?” Sajan told Khaleej Times.
“Dubai’s unique advantages – quality of life, safety, security, world-class infrastructure, international connectivity, and the country’s leadership in combatting the Covid-19 pandemic – have all helped more and more wealthy people to consider Dubai for investment and relocation. The recent liberalisation of the business licensing regime, and immigration reforms, have further shown the UAE’s strong drive to attract investors,” he said.
Sajan also said that the Covid-19 pandemic has demonstrated the UAE’s strong leadership in managing the pandemic, and creating a safe haven for people – while the rest of the world was reeling from the crisis.
“The UAE stood as a safe country to live in during the pandemic. As a result, we have seen how foreign businessmen and professionals started to invest in the UAE, relocate their families and set up businesses – which helped boost the real estate sector as well as economic activities,” he said.
“People felt safe in the UAE – in an ‘unsafe’ world. We have seen how Covid-19 has forced repeated lockdowns in different countries with a travel ban, and restrictions on people’s movement,” he said.
Ata Shobeiry, CEO at Zoom Property, said that 2021 certainly gave a much-needed boost to the property market, after it witnessed a brief sabbatical in the previous year.
“The second half of the year, in particular, showed tremendous growth. The effective ways in which the government handled the pandemic, Expo 2020 Dubai, and new visa reforms, are some of the major reasons that can be accredited for the powerful performance of the property market in 2021,” Shobeiry told Khaleej Times.
David Abood, partner at real estate consultancy, Core, said that 2021 has been a ‘historic year’ for Dubai real estate, with the highest-ever quarterly transaction volumes recorded over the last few quarters.
“The secondary market has led the recovery, signalling a strong local/resident demand, while the off-plan market has also followed through with a rise in transaction activity, albeit at a slower pace,” Abood explained.
He added that multiple demand drivers have accelerated real estate recovery, including the transition to normalcy with robust public health and safety measures, a high vaccination rate, a raft of social reforms, Expo 2020-driven demand across sectors, along with easier access to finance.
Furthermore, he said that most traditional source markets have faced prolonged lockdowns and relatively slower Covid-19 mitigation efforts, resulting in many international businesses and occupiers moving to Dubai due to its cemented position as a safe, open, and resilient city, resulting in a rise in inward investment.
Sajan said that the real estate sector’s outlook is bright due to the unique strength of the country.
“The real estate will continue to attract investment – as more and more people will be relocating to the UAE,” he said.
“The recent announcements by the UAE government – and those that will be made in the next few months – will create new economic opportunities for people. New businesses will flourish, and new jobs will be created, that will drive domestic demand. Therefore, the real estate sector will continue to grow,” he said.
Shobeiry of Zoom Property said the year 2022 looks even more promising.
“Even though Expo 2020 will drop the curtains in March, we can expect the market to continue its performance. The transition of the expo site into an integrated mixed-use community ‘District 2020’ will play a strong role in driving the market,” he said.
Abood of Core also said that the residential market is expected to sustain a strong recovery next year.
“While we expect the residential market in Dubai to continue improving in 2022, it is important to note that market recovery is expected to be segmented. Villa districts and most of the prime apartment locations are expected to continue witnessing a faster pace of recovery, while most affordable and outer apartment districts with ample existing stock are expected to see slower stablisation rates,” he said.
He also said that transaction volumes are expected to remain high over the first half of 2022 and then gradually stabilise over the second half of 2022.