Property buyers once again flocked to the doors of a Dubai developer on Wednesday to secure their own piece of the Palm Jebel Ali coastline in the form of a Nakheel villa.
The sight of buyers and agents jostling in a queue to put their deposits down and secure a beachside home is a familiar one to Dubai real estate market observers, and this launch was no different.
Prospective owners or their agents arrived as early as 3 am, and footage emerged online during the day of staff members containing crowds and announcing that the properties had sold out.
Matthew Solomon, Palm Jumeirah sales manager for Dubai based haus & haus Real Estate, said he had been coordinating a team of agents at the site Wednesday who were there to secure properties for clients.
The Palm Jebel Ali, which is to the south of the city of Dubai, is reportedly twice the size of its fellow palm tree-shaped man-made island Palm Jumeirah, and has been more than 20 years in the making, having spent a period in mothballs after the tumult of the 2008 global financial crisis.
The first villas launched this week following a Masterplan vision for the island, which was announced earlier this year, including plans for 80 hotels and resorts, green spaces and smart city technology.
The villa launch capitalises on Dubai’s cresting housing market, as prices are to maintain their strong momentum for the coming quarters according to analysts at Swiss bank UBS’s global wealth management office, who went as far as to describe the city’s current rental market as “red hot” but described sales prices as ‘fair-valued’.
The latest launch included Coral and Beach villas in different styles, on four of the Palm Jebel Ali’s fronds, with an expected completion date of 2027. Prices being paid started from around AED 18 million ($4.9 million) for a 7,200, sq.ft. villa and buyers were required to put down a 20% deposit plus a 4% Dubai Land Department (DLD) fee.
Solomon said buyers are aware of the long-term nature of their investment, as the island is still in the early stages of development, although some are likely to sell their properties on before completion depending on price growth.
Agents saw a mix of customers, from those living in the emirate already to foreign buyers as the queue gathered at Nakheel headquarters on the Palm Jumeirah.
There was little time for foreign buyers to fly in personally, as the launch was announced only earlier this week, so overseas investors instructed agents by phone or message.
The appeal of the Palms
The intensity of the interest is no surprise to Dubai real estate experts.
Knight Frank’s head of research Faisal Durrani attributed the demand to the fact that Dubai’s coastline is almost fully developed. So, the chance to own property on it is logically irresistible to real estate investors.
“Dubai’s coastline is more or less fully built out, so the opportunity to secure beach front homes on a development like the Palm Jebel Ali understandably is commanding high levels of attention from buyers,” he said.
Knight Frank Research shows that more than half of overseas high net worth individuals with wealth of $10 million or more, 53%, are keen on securing a villa in the emirate, he said.
He highlighted the performance of Palm Jumeirah, which has seen villa prices rise by 45% in 12 months, which he said was "underpinned by the demand from the global elite vying for access to Dubai’s cosmopolitan and sea-side lifestyle".
(Reporting by Imogen Lillywhite; editing by Brinda Darasha)