“The benefits will be enjoyed by all industries but surely impacts the most for Real Estate, Retail and Banking industry ahead of others. Add to all of this, the increased impact of Expo2020 that shall be delivered later this year,” Atif elaborated.

30%+ revenue growth

In its latest forecast, rating agency S&P Global also shared positive remarks on Dubai real estate and forecast more than 30 per cent revenue growth in 2021 on supportive market trends for real estate and a gradual recovery in other business segments.

“We expect Dubai’s GDP to rebound about 3.5 per cent in 2021, followed by growth of 2.5 per cent in 2022,” S&P analysts said.

“While we think that structural oversupply in Dubai’s residential real estate sector will linger, we think that demand for good-quality, premium assets will support sales in 2021. We expect 30 per cent to 35 per cent revenue growth in 2021, from high demand for residential real estate in Dubai and recovery in other business segments, namely the retail and hospitality sectors,” they added.

Market resurgence

Zhann Jochinke, chief executive of Property Monitor, said Dubai real estate market has witnessed a resurgence with prices appreciating slightly more than 10 per cent over the past seven months.

“Year-to-date 2021 property prices emirate-wide for Dubai have increased 8.3 per cent and I foresee that appreciation will continue through the remainder of the year however expect rate of price increase to slowdown in the coming months,” Jochinke told Khaleej Times on Monday.

A sustainable recovery

To a question about recovery is sustainable, he said: “In short, yes, however at a subdued pace particularly in the resale market of completed properties.”

He said a large driver of the recovery to date has been due to the sale of villa and townhouses in mature communities where end-users were for a time able to find incredible value. “With inventory in these areas becoming scare and prices rising at a rapid pace for prospective buyers who are familiar with the market have begun to pull back and not appease seller’s aggressive expectations.”

He said some of the fringe communities or less popular communities are yet to see overall price appreciation, however the market has begun to show signs of price stability and over the coming months will likely continue to see positive growth.

Regarding the off-plan market, he said a continued recovery will be heavily dependent on the level of new supply being approved to come to market for sale.

“New supply will be organised due to the oversight of Sheikh Mohammed bin Rashid Al Maktoum’s higher committee of real estate [announced in late 2019] and it will be closely monitored and is likely to result in significantly fewer new project launches than in recent years,” he said.

Expo to boost confidence

Nikita Kuznetsov, chief executive of Metropolitan Premium Properties, said the real estate outlook appears positive for the second half of the year especially with Expo 2020 just around the corner. He said the resale market is on an upward trajectory thanks to a steadily growing economy encouraging residents and citizens to move home to bigger and better options.

“We also are seeing more people relocating or investing in a second home here in Dubai or the UAE due to the positive steps taken by the government to battle the Covid-19 pandemic. We have also seen a spike in the number of transactions for villas and townhouses, with a notable interest and high demand in waterfront or shoreline property,” Kuznetsov told Khaleej Times on Monday.

Metropolitan Premium Properties is a full-service real estate agency offering customised solutions to developers, owners and investors who are looking to maximise value from their luxury real estate assets.

“With one of the largest premium property portfolios in the UAE – 20 per cent of our listings cater to properties over Dh10million, we have also seen strong demand for luxury property from overseas investors,” Kuznetsov said.

He said nearly 30 per cent of our transactions last year were from our international clients primarily from the UK and other parts of Europe including France, Germany and Austria and “we expect this trend to continue”.

“Location wise areas such as Dubai Marina, Downtown and Palm Jumeriah are consistently active, as well as the off-plan market showing impressive new projects that sell out at pace,” he said.

– muzaffarrizvi@khaleejtimes.com

Why people are investing in Dubai real estate

– Safety and security

– Capital appreciation

– Modern-day lifestyle

– Tax-free, stable economy

– Excellent infrastructure

Dubai property is back in demand

* 8,000+ New investors entered into the Dubai property market in H1

* 30%+ Revenue growth for real estate companies in 2021

* 10%+ Increase in Dubai real estate prices since November

* 8.3% Average jump in Dubai properties this year so far

Sources: S&P Global, Property Monitor and KT Research

Source link: https://www.khaleejtimes.com/business/real-estate/dubai-real-estate-back-in-demand-prices-to-go-up

Author: Khaleej Times