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The coronavirus pandemic has changed investors’ attitudes towards buying houses and sustainability is now high on the agenda for many property buyers in the Middle East, according to a new study.
Results of Knight Frank’s global buyer survey that were released on Monday showed that 50 percent of homebuyers in the region want their next villa or apartment to be energy efficient.
The study also found that proximity to green space (18 percent), good air quality (18 percent) and good views, such as ocean, mountain and skyline (14 percent), are more important to homebuyers in the Middle East than their global counterparts.
“Green is definitely the new black, and in the Middle East, buyers are increasingly focused on all things ESG. Half of the respondents cited the energy efficiency of their next home being a ‘very important’ issue, compared to 42 percent of global buyers,” said Faisal Durrani, head of Middle East research at Knight Frank.
Sales of residential units in Dubai have been rising since coronavirus restrictions eased last year. Many buyers gravitate towards villas in premium locations, as private space becomes a premium during the pandemic.
Last August alone, buyers spent 14.97 billion dirhams ($4 billion) on properties across Dubai, the highest recorded in a month since January 2017, according to Property Finder.
Across the world, buyers have also been snapping up homes since the coronavirus outbreak. According to Knight Frank’s survey, some 33 percent of global buyers said they are more likely to purchase a second residential property as a result of COVID-19, up from 26 percent last year.
Of those looking to buy a second home, 23 percent said the pandemic has influenced where they want to buy. Within the Middle East, 57 percent of respondents said they would be most likely to buy a villa, or a home in a more rural location for their next purchase, slightly higher than the rest of the world’s respondents (51 percent).
“This is a fascinating insight into what homebuyers are thinking for their next property chessboard move. In markets like Dubai, we’re already seeing villa demand driving faster price growth for villas than apartments,” noted Durrani.
Villa values in Dubai have climbed by 7.8 percent since the first quarter of 2020, compared to a -5.9 percent fall for apartments, according to Durani. He said this only shows that buyers are still eyeing bigger and more expensive homes for their next purchase.
(Writing by Cleofe Maceda; editing by Seban Scaria)
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