The property market in Dubai is increasingly signaling strong demand and stabilization with the surge in price recorded consistently over the past four months.
According to Property Monitor, for the three months ending in February, prices rose 4.6 percent. In the second month of 2021, the price recovery gained further momentum, with monthly gains of 1.9 percent recorded at an emirate-wide level after posting gains of 1.3 percent in January and 1.5 percent in December, and now stand at $233.6 per square foot back to levels last recorded in July 2012.
“The declines seen month-by-month in 2020 have almost been erased by the recent strong performance, with overall prices decreasing by just over one percent in the year to February,” Property Monitor noted in its monthly market report.
“This figure represents a very significant turnaround compared to the prior-year period to February 2020, when a year-on-year decrease of 11.4 percent was recorded. Based on current trends and reports from brokers of strong demand, Property Monitor predicts that the market will show further growth into the year as the world starts to exit the pandemic and international travel links are restored. The question will then be whether the current price growth is sustainable if supply is again triggered with new developments and off-plan sales recovery.”
Property brokers record a strong demand, especially in the popular locations, with a further surge in prices now likely as the world exits the pandemic. Arabian Ranches, Damac Hills, Jumeirah Islands, Mudon and The Villa have all posted highly consistent monthly price value over the past three to six months.
The Property Monitor report shows that for the ninth straight month, sales of completed properties dominated off-plan. The transactions of completed property accounted for 68.4 percent of sales in February while only 31.6 percent for off-plan.
“The pandemic and ensuing need for space seem to have triggered a sense of urgency among buyers and investors to secure ready properties that offer immediate possession in favorable locations before prices appreciate further,” said the report.
After a record-breaking volume of more than 3,000 mortgages in January, where nearly 50 percent of mortgages occurred on a single day, mortgage transactions rebounded to expected levels in February with 1,465 loans recorded.
In February, the resale transactions stood at 49.9 percent of the total market which is above the 12-month average of 34.9 percent. This steady growth of the resale market reflects a maturing sector where end-user and investment demand drives activity rather than speculation.