Dubai's real estate continues on upward trajectory in the first half of 2021

Bayut & dubizzle's combined data reveals that properties for sale in Dubai have seen price increases between 6% to 20% in H1 2021

  
Dubai's real estate continues on upward trajectory in the first half of 2021

Dubai: Bayut & dubizzle, the UAE’s leading property portals, have released their combined Dubai Property Market Report for H1 2021, which has revealed that the emirate’s real estate sector recorded an incredible performance in the first half of the year, with impressive growth observed in sales and rental prices across most popular areas.

  • Bayut & dubizzle’s combined data reveals that properties for sale in Dubai have seen price increases between 6% to 20% in H1 2021.
  • Prospective buyers have turned to Jumeirah Village Circle (JVC), Akoya Oxygen, Dubailand and Jumeirah Lake Towers for affordably-priced apartments and villas, while HNW investors have favoured established communities such as Dubai Marina, Downtown Dubai and Arabian Ranches. Newer gated suburbs such as Dubai Hills Estate have also grown in popularity during H1 2021. 
  • Dubai’s rental market has largely seen minor decreases under 10% in asking prices for affordable apartments, while luxury properties have experienced increases up to 13%. The affordable villa segment has seen rental rates remain largely steady in H1 2021, while the luxury market has observed a growthbetween 5% to 21% in asking rents.
  • Tenants working within a tighter budget have shown a preference for Jumeirah Village Circle (JVC), Al Nahda, Mirdif and Akoya Oxygen, while Dubai Marina, Downtown Dubai, Jumeirah and Al Barsha have been most popular with high-income renters searching for luxury apartments and villas.
  • According to data released by the Dubai Land Department, 16,558 sales transactions for residential properties worth AED 24.7B were recorded in Dubai in the first half of the year. Transactions for ready properties came out ahead in H1 2021, accounting for 59% of total residential sales. This could be attributed to the growing demand from end-users looking to transition to homeownership or upgrade their homes.

This uptick in the Dubai property market has been driven by various factors: the UAE was recently ranked as the second-safest country in the world as well as the most vaccinated nation for COVID-19 globally as per the Reuters tracker which confirms that at least 76.1% of the UAE population have received at least one dose of the vaccine . This has not only helped economic activity in the country to recover post the lockdown but also highlighted its attractiveness as a global investment destination. 

Other strategic reforms such as the introduction of remote work visas, announcements about the recipients of the Golden Visa and 100% foreign company ownership have also been instrumental in enhancing the country’s business infrastructure, attracting global talent and in turn, increasing the appetite for real estate. Dubai-based developer Emaar Properties reported property sales surging by 250% in the first five months of 2021 as opposed to the same period last year, while the Dubai Land Department recorded a 221% growth in the value of sales transactions in May 2021, compared to May 2020.

Properties for Sale

Apartments:

Bayut & dubizzle’s comprehensive report reveals that Dubai’s luxury apartment segment has recorded impressive growth in H1 2021, with sales prices appreciating across all popular communities.

  • Dubai Marina has continued to be the long-standing favourite for luxury apartments for sale. The average sales price-per-square-foot for apartments in Dubai has increased by 7.11%, rising from AED 1,160 in H2 2020 to AED 1,242 in H1 2021.
  • Downtown Dubai and Business Bay have also seen average price-per-square-foot for apartments rise by 7% and 6% respectively, while Jumeirah Beach Residence and Palm Jumeirah have recorded increases around the 20% mark, pointing to the sustained demand for luxury waterfront homes.

When it comes to affordable apartments, Jumeirah Village Circlehas retained the top position among prospective buyers

  • Apartments in Jumeirah Village Circle have experienced a slight dip in sales price-per-square-foot in H1 2021, going from AED 839 to AED 812. This could be attributed to sellers keeping prices competitive as more projects are handed over in the area, such as Bloom Towers.
  • Jumeirah Lake Towers, Dubai Silicon Oasis, Dubai Sports City and International City have also generated interest for reasonably priced apartments. These popular neighbourhoods have seen sales prices remain stable or increase up to 6%.

Villas:

As per the trends observed on Bayut & dubizzle, luxury villa communities have seen sales prices appreciate across the board in H1 2021.

  • The family-friendly development of Arabian Ranches has remained the firm favourite for upscale villas in the first half of 2021. The price-per-square-foot of villas for sale in Arabian Ranches stands at AED 1,088, up from AED 917 in H2 2020.
  • The up-and-coming gated community of Dubai Hills Estate has also garnered significant attention from buyers and investors, with the average price-per-square-foot increasing by 14% to AED 1,203 for villas.
  • Other ultra-luxurious residential developments such as Palm Jumeirah and Jumeirah Golf Estates have also recorded impressive growth in sales prices for villas around the 18% mark, averaging at AED 2,623 and AED 1,207 respectively.

In H1 2021, Akoya Oxygen overtook Jumeirah Village Circle to become the most popular location among prospective buyers for affordable villas, pointing to the growing popularity of suburban developments.

  • The price-per-square-foot for villas for sale in Akoya Oxygen has remained steady in the first half of the year, averaging at AED 557.
  • Other suburbs such as Jumeirah Village Circle and Dubailand have experienced increases between 6% to 8% in price-per-square-foot for villas.
  • Well-integrated developments such as The Springs and Mudon have also retained the attention of potential buyers and investors in the first half of 2021. Both communities have seen an increase in sales prices between 10% to 16%, revealing a sustained demand for communities with family-friendly facilities.

Rental Yields in Dubai

  • International City has continued to generate strong return-on-investment of 7.51% for apartments, based on projected rental yields. In the luxury segment, Dubai Marina has been yielding healthy returns of 5.54% in H1 2021.
  • For villa properties, Jumeirah Village Circle has continued to offer good rental returns of 5.86%, while Jumeirah Golf Estates has emerged as the best option for investors in the luxury home market, yielding an average ROI of 5.52%.

Off-plan Projects in Dubai

  • According to data released by Bayut & dubizzle, Binghatti Mirage in Jumeirah Village Circle has dominated the attention of prospective buyers for competitively-priced off-plan apartments, while Rukan in Dubailand has been the preferred choice for affordable off-plan villas.
  • In the luxury property market, Downtown Views II has emerged as the most popular choice for off-plan apartments, while District One in Mohammed Bin Rashid (MBR City) has continued to generate the most interest for off-plan villas.

Properties for Rent

Apartments:

As per Bayut & dubizzle’s analysis of the rental market in Dubai, Jumeirah Village Circle (JVC) has continued to be the firm favourite with tenants for affordable apartments in H1 2021.

  • The rental costs for apartments in JVC experienced minimal declines between 1% to 5%,averaging at AED 27k for studios, AED 42k for 1-bed apartments and AED 60k for 2-bed apartments.
  • Al Nahda, Dubai Silicon Oasis, Bur Dubai and Deira have also continued to be popular choices for affordable accommodation. These neighbourhoods have largely registered minor decreases under 10% across the board, which could be attributed to landlords incentivising tenants with lower rental rates as luxury properties grow in popularity.

Dubai Marina has generated the most interest for luxury apartment rentals in the first half of 2021, as per Bayut & dubizzle’s combined analysis.

  • The average rents in Dubai Marina have experienced minor fluctuations in H1 2021, with studio flats dipping from AED 63k to AED 61k. On the other hand, rental costs for 1 and 2-bedroom apartments in Dubai Marina have increased between 2% to 6%, averaging at AED 94k and AED 134k respectively.
  • Apartments in Downtown Dubai have seen increases in rental costs between 2% to 10%, while Sheikh Zayed Road has recorded decreases of up to 13% in H1 2021.
  • Consumer demand for upscale waterfront apartments has also been on the rise in H1 2021, according to trends observed on Bayut & dubizzle. Palm Jumeirah and Jumeirah Beach Residence (JBR) have seen average rents for apartments grow between 5% to 13% in the first six months of 2021.

Villas:

When it comes to affordable villa rentals, Mirdif has been the preferred choice among prospective tenants in H1 2021.

  • The average rents for 3 and 5-bed houses in Mirdif have experienced minor decreases under 6%, averaging at AED 84k and AED 112k respectively. However, 4-bed villas in Mirdif have seen rental costs remain steady at AED 107k.
  • In line with trends observed in 2020, potential tenants have focused their search for budget-friendly villas in suburban communities such as Akoya Oxygen, Jumeirah Village Circle and Dubai South.
  • The Springs has recorded an increase of 16.7% in rental costs for 3-bed villas, rising from AED 123k in H2 2020 to AED 144k in H1 2021.

According to Bayut & dubizzle’s combined market report, luxury villa communities have experienced an upswing in rental costs for bigger bed types in the first half of 2021.

  • Jumeirah has continued to be the most sought-after community for luxury homes in H1 2021. While average rents for 4 and 5-bed villas have remained steady at AED 173k and AED 224k, 6-bed villas in Jumeirah have seen rental costs increase by 12.8%, averaging at AED 318k.
  • Al Barsha and Umm Suqeim have followed a similar trend, recording increases in average rents for 5 and 6-bed villas between 4% to 21%.
  • High-income renters have also shown a preference for gated developments such as Dubai Hills Estate and Arabian Ranches. The rental costs for houses in Arabian Ranches have also seen an uptrend in H1 2021, rising between 16% to 18%.

Haider Ali Khan, CEO of Bayut & dubizzle and Head of EMPG MENA, also commented: “Since the beginning of 2021, there have been growing signs that the Dubai property market is on a steady upward curve, with prices appreciating especially in the sales segment. Most real estate agencies have also confirmed this by sharing the outstanding results of their H1 performance. In fact, if we look at the transactional data from the Dubai Land Department, it’s clear that interest and conversion are both high, with the percentage of transactions going up by an impressive 200% in May 2021 compared to the same period last year.”

“The positive performance of the Dubai property sector has also been reflected on both of our portals with a combined traffic of over 28M sessions. High COVID vaccination rates, investor-friendly reforms and an economy that’s been able to quickly adapt and get back on its feet post the lockdown will continue to drive the growth of the Dubai real estate market.”

-Ends-

For an accurate representation of price changes, this report compares the average price-per-square-foot in an area to analyse sales trends for villas and apartments in H1 2021 to those observed in H2 2020. These prices are however subject to change, based on the building, amenities, developer and other deciding factors. For the rental properties, the report compares the average cost for individual unit types between the two periods, in popular Dubai neighbourhoods.

Disclaimer: The above report is based on prices advertised by real estate agencies on behalf of their clients on Bayut.com and dubizzle.com, and not representative of actual real estate transactions conducted in Dubai except for instances where the DLD has been quoted.

About Bayut

Bayut is the UAE’s most trusted property website for buying, selling and renting homes. Bayut provides detailed insights, extensive content resources and updated statistics allowing end-users to make the best decision when searching for properties in the UAE.

Since Bayut was established in 2008, the company has seen accelerated growth, increasing not only the number of real estate partners it works with, but also obtaining substantial traffic growth over the past few years. Haider Ali Khan joined Bayut in 2014 as the CEO and the company has continued to showcase very high growth over the past five years including closing multiple rounds of funding from top Venture Capital firms such as Naspers, KCK, Exor, and other notable names. To further expand their reach in this region, Bayut also launched Bayut.sa in 2019, with its headquarters in Riyadh. 

Bayut is a part of the Emerging Markets Property Group (EMPG) which also operates the largest property classified sites in Pakistan, Bangladesh and Morocco. In April 2020, the group merged with the Netherlands-based OLX group in certain key markets, and was valued at $1 Billion, giving it the coveted unicorn status. The group now also owns and operates Dubizzle in the UAE, OLX Pakistan, OLX Egypt and OLX Lebanon, in addition to several other OLX platforms in the broader Middle East region including Bahrain, Oman, Kuwait and Qatar.

About dubizzle:

dubizzle is the leading classifieds platform for users in the United Arab Emirates. Since its launch in 2005, dubizzle has become the number one platform for users to buy, sell, or find anything in their community. A community where underused goods are redistributed to fill a new need, and become wanted again, where non-product assets such as space, skills, and money are exchanged and traded in new ways that don’t always require centralized institutions or ‘middlemen’.

For further information, please contact:
Khalid Yahya
PR & Communications Manager
Khalid.Yahya@Bayut.com
Khalid.Yahya@dubizzle.com 

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© Press Release 2021

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