Why the investment in real estate in Dubai is growing: the reasons
The investment attractiveness of Dubai and the UAE as a whole requires no proof. For a long time the capital of rich people from different countries has been flocking here. Someone buys local luxury real estate for their own residence or vacation, others prefer to use it to multiply their money. One way or another, real estate investments in Dubai are always in demand. However, during the pandemic, this market sagged significantly, and experts predicted a long-term recovery of the segment. However, the surge of activity that was observed in the second half of 2020 showed that the process will take less time than anticipated at the beginning of the pandemic.
According to official statistics, in May this year in the Dubai market was concluded 6021 deals for a total amount of 5.9 billion dollars. This figure is 197% higher than last year’s result by the number of concluded contracts and 221% higher by value. The share of sales transactions in the total number took 74%.
Experts point out that the growth rate in property values in Dubai is the highest in the last 7 years. And the increase in prices will continue in the future. Only in the first half of the year, the volume of transactions exceeded the maximum of 4 years.
The investors are most interested in the objects located in the elite districts of Al Thanyah Fourth, Hadaeq Sheikh Mohammed Bin Rashid, Palm Jumeirah, and others. Leaders in terms of the number of deals concluded last month were Dubai Marina, Al Thanyah Fifth, and Burj Khalifa.
However, in spite of the large growth, compared to April market activity has decreased slightly. The volume of sales of objects under construction decreased by 10.7% and finished housing – by 14.8%.
High demand for real estate caused the rise in prices. Most of all the cost of villas increased, on average over the year these objects rose by 5.4%.
As for apartments, for a month they have added in price 1,3%, most of all it has affected the cost of the Palm Jumeirah and Business Bay.
The share of deals made at the construction stage amounted to 44%, the most popular were projects in Dubai Hills Estate, Jumeirah Village, and others.
The UAE economy continues to show good dynamics of recovery, which contributes to an increase not only in local investment but also in foreign investment. Non-residents are actively buying up luxury villas overlooking the ocean; they are also interested in townhouses and apartments in new gated communities.
Locals are also buying new homes in order to work remotely in comfort.