Dubai’s villa property market has posted its best performance in about seven years, as demand for residential space continues to drive sales prices.
The citywide price index by consultancy ValuStrat, which tracks price movements of villas and apartments across the emirate, went up by 3.8 percent during the second quarter of 2021, writing off almost all the residential capital losses of the previous year.
The growth was led by the villa segment, which showed an annual increase of 6.3 percent and a quarterly increase of 7 percent, the highest since 2014. The highest annual gains were recorded in The Meadows, Arabian Ranches, The Lakes, Jumeirah Islands, Dubai Hills Estate and Mudon, the report said.
According to Haider Tuaima, head of real estate research at ValuStrat, increased demand for high-end villas within well-established and well-connected villa communities is driving prices higher. "These are in limited supply and at very attractive price points when compared to previous peaks. COVID-19 work-from-home lifestyles and attractive finance options fueled this demand even further. This has led to competitive bidding in some pockets," Tuaima told Zawya.
Demand for properties in Dubai has picked up since coronavirus restrictions eased last year, partly driven by record-low prices, interest rates and attractive loan-to-value ratios of up to 85 percent.
During the month of May alone, a total of 4,429 property deals worth 11.11 billion dirhams ($3 billion) were made, the highest since March 2017.
According to Dubai-based listings portal Property Finder, the total transaction value in Dubai’s real estate market has recovered by more than 324 percent since the COVID-19 lockdown last year, indicating that the market has rebounded.
Most of the buyers, however, prefer secondary homes and villa units.
ValuStrat’s latest data showed that the apartment market in Dubai has remained subdued, posting only a 1.7 percent increase when compared to the previous quarter, and a 4.8 percent decline when compared to the same period in 2020.
Among the locations monitored, Jumeirah Beach Residence, Palm Jumeirah, Downtown Dubai and the Views showed the best performance.
“This is contrasted with Jumeirah Village, Dubai Marina, The Greens and Dubai Production City. However, compared to last year, apartments in International City, Palm Jumeirah, Jumeirah Beach Residence, Al Furjan, and Al Quoz Forth, have written off their capital losses of last year,” ValuStrat said.
(Reporting by Cleofe Maceda; editing by Seban Scaria)
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