According to real estate services firm, Chestertons, Dubai’s pandemic response, overall quality of life, and recent visa reforms supported near-record transactions over Q3. But that’s only half the story. Developers at Cityscape are splurging funds aiming to satisfy an insatiable appetite for UAE’s property sector.
The findings revealed in the latest Observer: UAE Q3 2021 Market Report showed that total residential transaction value in Dubai increased by 10% Quarter-on-Quarter (Q-o-Q) to 34.11 billion dirhams ($9.3 bn), up from 31.02 bn dirhams ($8.45 bn) in Q2. Completed property sales accounted for 20.63 bn dirhams ($5.62 bn) of the total value, while off-plan sales increased in value Q-o-Q by 48%, to 13.48 bn dirhams ($3.67 bn), as developers stepped up marketing activity ahead of Expo 2020.
Chris Hobden, Head of Strategic Consultancy, Chestertons MENA, said: “We have seen notable sales growth in the luxury segment, which we define as properties priced at 30 million dirhams ($8.2 mn) and above, reflecting Dubai’s clear appeal to high-net-worth buyers internationally.”
Luxury residential sales value totaled 2 billion dirhams ($545 mn) over Q3, bringing total luxury sales value to 4.6 bn dirhams ($1.25 bn) over the year’s first three quarters. This compares to 919 mn dirhams ($250 mn) and 1.13 bn dirhams ($308 mn) during the same period in 2020 and 2019, respectively.
Strong demand continued in Q3 for Dubai’s villa sales sector. An influx of new residents and sustained demand from settled expatriates increased market-wide villa prices by 6.4% Q-o-Q, supporting a 17.1% rise above their Q3 2020 average.
Palm Jumeirah, Arabian Ranches, and Jumeirah Park saw the highest quarterly uplifts, with prices rising by 8.8%, 8.2%, and 7.7%, respectively. Average prices in Palm Jumeirah reached 2,225 dirhams per sqft ($606), with Arabian Ranches seeing average prices rise to 920 dirhams per sqft ($250) and prices in Jumeirah Park reaching 840 dirhams per sqft ($229).
Average values across The Lakes, The Meadows/The Springs, and Al Furjan rose by 6.6%, 6.2%, and 5.7%, respectively, Q-o-Q. Damac Hills and Emirates Hills recorded more moderate quarterly gains, of 4.2% and 3.7%, respectively, with prices in Damac Hills averaging 1,000 dirhams per sqft ($272.5) and Emirates Hills topping 1,820 dirhams per sqft ($496).
Meanwhile, apartment prices in Dubai witnessed a clear uplift, with average values rising by 2% Q-o-Q, with established residential areas typically recording more substantial gains. Downtown Dubai and Business Bay saw the highest quarterly rises, of 5.1% and 5.0%, respectively, with prices for the former averaging 1,450 dirhams per sqft ($395), and the latter reaching 1,050 per sqft ($286).
In Dubai’s villa rental market, average rents rose by 5.2% Q-o-Q, with annual rates increasing 12.6%.
Emirati entrepreneur Abbas Sajwani has launched an uber-luxury real estate company, AHS Properties, with a total asset value of more than $100 million, just ahead of Dubai’s Cityscape, which is taking place from November 9-11.
AHS Properties is selling premium estates in Emirates Hills, as well as beachfront villas on Dubai’s exclusive Palm Jumeirah. The Company currently has four luxury villas in its portfolio, of which 3 are valued at 80 million dirhams ($21.8 mn) each and the fourth valued at more than 150 million dirhams ($40.9 mn).
Sajwani, Founder of AHS Group, the parent group of AHS Properties, said: “Dubai’s luxury property offering is growing in demand and set to boost sales growth in 2021.”
The number of homes worth more than $10 million that have been sold in the emirate currently stands at 54, breaking the previous record of 31, set in 2015.
AHS Properties’ asset portfolio comprises sought-after and high-end properties which include the super luxurious Amara Villa at Emirates Hills worth $40 mn. The mansion has 45,000 sqft of built-up area and living space with seven en-suite bedrooms.
Abbas Sajwani is the son of Hussain Sajwani, founder of DAMAC Group, a successful conglomerate that has a diverse portfolio ranging from capital markets, hospitality, data centers, fashion, retail, and real estate.
At Cityscape on Tuesday, developers unveiled the latest plans for new villa communities across Dubai.
Spread across 145 sqkms near Al Maktoum International Airport, Dubai South is one of the city’s largest new developments.
Phase one of The Pulse, a residential community of 288 homes, has three, four, and five-bedroom villas starting from 1.35 million dirhams ($370,000).
Flexible working has fuelled the trend towards villa living across much of Dubai.
Kory Thompson, Middle East country head of office suppliers IWG/Regus, said flexible working is here to stay and is the main driver of new market trends.
According to the National, Azizi Developments plans to spend at least $2.72bn to develop 100 new projects over the next 4 years as it expects the UAE’s property market to continue to recover at a strong pace amid surging sales, according to the company’s chief executive.
“Between 2022 to 2025, we are looking at launching another 100 projects, minimum,” Farhad Azizi told The National on the sidelines of Cityscape in Dubai.
The developer has 10 plots and looking to acquire 90 more for its future portfolio expansion, and is in active talks with government-backed master developers including Nakheel, he said.
“Right now, we have between 70 and 75 projects under construction and under 30 delivered in Dubai,” Azizi said. “In 2025, we would easily deliver more than 100 projects.”
Meanwhile, Dubai developer Sobha Realty plans to build a $4 bn mixed-use project in the emirate named Hartland Sanctuary. The project, spans11 million sqft and will be built next to its current project Sobha Hartland in the MBR City.
Sobha has a target of more than $1bn in sales next year and the company is aiming for net sales worth $1bn by the end of 2021, according to Jyotsna Hegde, president of Sobha Realty.