Villas continue to drive Dubai property market in 2022: experts

Photo used for illustrative purposes only.

Inayat-ur-Rahman, Enterprise Editor

The ValuStrat price index, which measures the performance of the value of residential capital in Dubai, found property prices jumped 18.8% per year and 1.2% per month. Villas spearheaded this trend as prices jumped 34.1% annually, but experienced a steady growth rate of 2.1%.

Apartments grew in the single digits of 8.4% per year with marginal monthly growth of 0.4%.

The overall residential VPI reached 79 index points in March 2022. Although this is 21% lower than the January 2014 index base of 100 points, the typical Dubai apartment VPI reached 69.5 points , however, typical villas nearly touched the index base at 94.1 points .

Villa’s capital value increased at a constant monthly rate of 2.1%, with some areas seeing price increases slightly, such as Mudon (0.5%) and Green Community West (0.8%). On an annual basis, average villa prices jumped 34.1%. The top performers were Jumeirah Islands (40.3%), Arabian Ranches (40.3%), The Lakes (37.1%) and Jumeirah Village (35.5%). In March 2022, villas located in the Palm Jumeirah broke through their 2014 highs of 5.3% with 126.6 index points.

All apartment locations monitored by the valuation-based index recorded positive annual capital gains averaging 8.4%. The best annual apartment performance with double-digit growth was recorded at Palm Jumeirah (21.9%), as well as established locations such as Jumeirah Beach Residence (16%), Burj Khalifa Tower (15.3% ), The Views (10.9%) and the Greens (9.7%).

The volume of home sales in Dubai increased by 26.1% compared to the previous month and by 146.6% compared to the same period last year. The month-on-month performance saw cash and mortgage sales of ready-made properties as well as off-plan Oqood (contract) registrations increase by 26%, the latter accounting for 43% of overall transactions . March saw 15 transactions valued at over Dhs 30 million, including a 6-bedroom villa in Emirates Hills sold for Dhs 75 million.

Ata Shobeiry, CEO of Zoom Property, told Gulf Today that villas will continue to show dominance with monthly growth of 2.1% in March, while the apartment sector saw marginal growth of 0.4% in price. “With new projects in the pipeline, the gap between villa and apartment price growth is expected to gradually narrow,” Shobeiry said.

Taimur Khan, Head of Research – Mena at CBRE in Dubai, comments: “Despite the continued increase in the cost of funding and the tightening of payment plans, we have yet to see this impact on transactional activity on the Dubai residential market. In fact, the total number of transactions in March reached 7,865, compared to 5,598 a month earlier. As a result, it is the strongest first quarter ever for Dubai in terms of residential transactions While average prices and average rents continue to rise, we are seeing a moderation in sales and rental growth rates in the villa segment of the market.

Leading the sales, properties developed by Emaar (24.3%), Damac (17.7%), Nakheel (6.9%), Select Group (4.1%) and Dubai Properties (3.2%) . Top off-plan locations traded this month included projects in Business Bay (15.7%), Dubai Creek Harbor (9.2%) and Downtown Dubai (8.8%). The most traded ready-made homes were in Damac Lagoons (16%), Jumeirah Village (5.8%), Dubai Marina (5.6%) and Business Bay (5.3%). Dubai Hills Estate apartments and Jumeirah Islands villas have broken their individual records with the most homes sold in a month since 2010.

ValuStrat offers premium subscription reports for clients giving them access to in-depth statistical analysis of what is happening in residential real estate; allowing for more informed decision-making and planning. Comprehensive and in-depth 100+ page Dubai report includes city-wide analysis of freehold neighborhoods including ValuStrat price index, transaction volumes, service fees, price ratios /rent and net returns.

ValuStrat is a leading international consultancy firm headquartered in Dubai providing advisory, valuation, research, transaction advisory, industry advisory and due diligence services across a wide range of industry sectors since 1977. Offices in the United Arab Emirates, United Kingdom, Saudi Arabia, Pakistan and Qatar serve more than 1,000 corporate clients in the Middle East. Customers include financial institutions, local businesses, multinationals, governments, SMEs, family businesses and startups.

Some of the key industries served by ValuStrat include Real Estate, Hospitality, Retail, Education, Healthcare, FMCG, Manufacturing, Finance, Entertainment, Agriculture, Energy and transport. ValuStrat is a Royal Institution of Chartered Surveyors (RICS) regulated company and the first company in the entire MENA/Asia/Africa region to be accepted into the prestigious RICS Tech Affiliate program, now known as “RICS Tech Partner” .

The ValuStrat Price Index for Dubai Residential Capital Values ​​is a valuation-based index constructed to represent the monthly price change experienced by typical residential units in Dubai. The ValuStrat Price Index for Dubai Residential Rental Values ​​represents the quarterly rent change experienced by typical residential units in Dubai.

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