Rents to sustain an upward trend as Expo 2020 Dubai generates property demand

• Higher rental prices expected in Q4, based on upward trends in Q3 and Q2, 2021.

• Areas closer to Expo 2020 site to yield high returns for property owners

• Up to 14% hike in affordable housing and 30% increase in luxury property rents likely in Q4

The Dubai real estate sector has witnessed an upward trend in the rental market in Q3, 2021, with an estimated 14% increase in affordable housing and up to 30% increase in luxury housing in selected areas. The fourth quarter is expected to follow suit with the commencement of Expo 2020 Dubai, according to Zoom Property Insights.

The first ten days of the marquee event recorded 411,768 visitors, and it is expected to welcome up to 25 million visitors from different countries throughout its six-month run. From these figures, it can be ascertained that the areas located close to the event site will remain busy during this world fair. There is an expected growth both in terms of rental prices and demand in these areas.

Dubai property market quarterly reports from different property portals show that the Q3 saw an increased activity in Jumeirah Village Circle (JVC), Al Nahda, Bur Dubai, Dubai Silicon Oasis and Deira for affordable flats, while tenants seeking luxury apartments for rent preferred Dubai Marina, Downtown Dubai, Jumeirah Beach Residence (JBR), Palm Jumeirah, and City Walk.

Mirdif, DAMAC Hills 2, JVC, Reem and Dubai South topped the charts for affordable rental villas. For luxury villas, Jumeirah, Al Barsha, Umm Suqeim, Arabian Ranches and Dubai Hills Estate remained the top pick of tenants. As per Zoom Property Insights, these areas will remain at the forefront in Q4, 2021 as well.

The shift of demand towards large homes, return of foreign investors to Dubai, and expatriate-friendly policies are the major reasons accredited to increase in demand and property prices, apart from the ongoing Expo 2020. The recently announced golden visa scheme and 100% business ownership policies have also resulted in increased entrepreneurial and investment activities in Dubai. The change due to these policies is reflecting in the rental property market, as both the demand and prices are witnessing substantial growth this year so far.

Mr Ata Shobeiry, CEO at Zoom Property, said: “The promising statistics in 2nd and 3rd quarters of 2021 paved the way for a strong fourth quarter. Due to the ongoing Expo and a strong comeback by the Dubai property market post-pandemic setback, rental prices will see a significant increase in the last quarter.”

Apart from the rental market, property sales are also speculated to witness a surge in Q4, as the third quarter showed promising results. With 15,926 deals worth AED 42.35 billion, it has become the best ever third quarter vis-à-vis transaction value in the history of the Dubai property market.