Property prices in Dubai have started to increase on the back of strong demand, with values in March rising by 1.3 percent compared to 2020, the first yearly increase since 2015, Property Monitor said on Tuesday.
"Property prices have increased..., confirming the strong reversal of the downward trend of recent years," the research firm said in a report.
As of March, the median price for apartments in Dubai stood at 888,442 dirhams ($241,882), while townhouses and villas were going for around 1.47 million dirhams and 3.1 million dirhams, respectively.
"The last time rates were at this level in October-November 2012 during the previous cycle, prices went on to rise for a further two years," Property Monitor said.
Dubai's property market had been subdued prior to the coronavirus pandemic, mainly due to a huge supply glut. The market hit further declines when the global lockdown put everything on hold, but pent-up demand started to trickle out after the COVID-19 restrictions eased.
Over the last several months, buyers have been snapping up ready-to-occupy units, including villas and apartments.
The off-plan segment, which still had limited demand last year, is only just starting to see newly launched projects sold out in a matter of hours.
According to Property Monitor, overall sales transactions in March were at a ten-year high, as the market continued to grow.
Sales of properties at the higher end of the market, those with price tags of more than 10 million dirhams, also increased.
Last month, a villa on Palm Jumeirah that was valued at 111.25 million dirhams, went up for sale. It was later purchased by a Swiss family, marking the second-highest transaction on record for a residential property in Dubai.
According to Zhann Jochinke, chief operating officer at Property Monitor, prices have already posted gains for five consecutive months.
"Dubai's price recovery is well underway though not uniformly spread across communities. Voll and townhouse communities have particularly emerged as hot spots with a further acceleration in prices expected over the coming months," Jochinke said.
"Newer communities have joined the established locations as the preferred options for buyers with many also opting for turnkey houses in the absence of finding homes where they can renovate as per their requirement," he added.
ValuStrat's price index earlier showed a 0.8 percent quarterly improvement in overall prices as of the first quarter of the year.
"All established freehold villa locations monitored by the [index] saw capital values improve since the last quarter, ranging from 1.8 percent to 5.4 percent. However, only half of apartment locations improved in value, some areas saw declines of up to 2.8 percent," Haider Tuaima, head of real estate research, told Zawya.
(Reporting by Cleofe Maceda; editing by Seban Scaria)
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