Every since the pandemic hit us in 2020, a lot of families that we know in Dubai have shifted from apartment living to villas. Incidentally, a lot have moved from renting to buying.
The following article is written by a guest writer on the property outlook this year – 2022.
Dubai is an international business hub, a significant contributor to the city’s economy. People residing in this place are predominantly expats or international visitors who move into this city for work and other entrepreneurial ventures. Those living here in the long term prefer to invest in a residential asset. The increasing population in Dubai and other parts of Qatar is one main reason for the continued residential developments in the last few decades.
This number is only rising with every passing year, encouraging more buyers to indulge in Dubai’s real estate business. However, property businesses in Dubai and the outskirts faced a dip during the pandemic time. Not many transactions were happening previously, leading to a drop in the country’s economy. With an enormous number of new projects coming up, it is possible to guess what to expect from the Dubai property market in 2022.
Despite the sky-high prices, people are ready to buy a home in the luxurious neighbourhoods of Dubai. With too many housing options scattered across the city, the demand for luxury properties for sale in Dubai is gearing upwards currently. Real estate trends might change in the coming days due to several reasons. This will however not have a significant impact on the property sales and will continue to remain robust in the coming years.
CURRENT MARKET TRENDS
After a chaotic 2020, the property market has gained the right pace and is running to become a successful feat. The government usually builds a specific number of housing units every year to match the increasing demand for new properties from local and overseas investors. The average property prices have spiked up by 9.3 per cent, where transaction levels were at their peak in 2021. Off-plan properties sold over a whopping Dh 5.32 billion worth of properties, and the rest of the purchases are in the pipeline. Residential property purchases would progress at a slow pace in 2022 but will stay strong and grow further in the coming months.
PROPERTY TYPES IN DUBAI
With properties that come at different sizes, types, and prices across the city, Dubai is home to a varied collection of households that are distinct in their own ways. People who enter Dubai to buy or rent a property will have a wide range of residential options to pick from. From mediocre, affordable to luxurious homes, people can decide a type and size according to their budget. Types like villas- compound and community, lofts, townhouses, and apartments are available across Doha. Studio flats and modern flats are popular among the residents here, and are the in-demand property type in the city. In 2022, more apartments and lofts will be available for purchase due to the high demand from students, working professionals, and young families.
After the worldwide lockdown scenario that prolonged for over a year, the real estate business was more of a roller coaster in every country. Recovery time for the real estate business has been different in different places. The pandemic took a toll over Dubai’s property market for a stretch before the economy started booming back to normal. Property prices started rising soon after the demand for new and pre-owned properties was higher. By 2022, prices will continue to go up further. Usually, completed apartments have a higher market compared to unfinished or off-plan properties. Due to the exclusive offers, preferences and demand, off-plan properties are on the run currently. By the mid of January 2022, more than 58 per cent of the total off-plan properties in Dubai were sold. The total off-plan transaction rate has increased by 307 per cent, giving excellent profits to developers in the real estate business. However, other transactions will happen at a slower rate due to surplus housing units available in the city. These purchases could be a tad bit of a lag by the end of the year.
THE RENTAL MARKET
Population growth in Dubai and other states of the UAE has been quite evident over the last few years. When living here for a brief period, expats prefer to rent a property instead of splurging thousands on one to purchase it. Rental yields are the best means of passive income for those who invest in properties in Dubai. Over the years, properties for rent have increased tremendously. The average rent has surged by 8.3 percent in the last year due to the competitive rental market. The rental range will grow by 5 per cent and more in 2022, opening more opportunities for buy-to-let homes in prominent regions of Dubai.
DEMAND VS SUPPLY IN DUBAI
Dubai is a well-planned city in the UAE, where everything here is carried out with a calculative approach. After several years of the plagued property market, Dubai has seen tremendous growth with regular new-builds being updated across the city. The demand-supply proportion has always been a balanced one. According to the current market trend, there is a surplus in supply to match individuals’ requirements. Properties are being built every quarter of the year. With the property overflow in Dubai, it is often the buyers’ market in this region. The year 2022 will be a busy time for both the buyers and sellers. Transactions could be slightly slower than last year, but the market pace will remain stable and intact.
HOUSING SECTOR IN THE COMING YEARS
It is always a baffling task for investors to find the right time to buy a property in a massive city like Dubai. People are ready to invest in properties now more than ever. Off-plan properties and newly built homes are being sold off in a flash. Developers are trying to create new incentives and offer to sell these homes. Being in the buyer’s market, the year- 2022 is a favourable time to purchase residential properties in Dubai. Prices will continue to increase in 2022 and beyond that. It is better to grab the best offer at the right time and make use of it to get the ideal home.
Note : This article is written by a guest writer.
To read personal accounts of parents living in different neighbourhoods in Dubai – have a look at “Is Dubai Suitable for Families?“