Dubai properties are transforming sellers’ market as investors take advantage of three-year price rally
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Property prices have increased several times, surpassing the 2014 peak last year due to unprecedented demand seen in the post-pandemic period.
Dubai’s residential market is increasingly becoming a seller’s market to cash in on the gains made over the past three years in property prices.
Industry insiders say the rebound in real estate prices is showing signs of slowing with growth set to stagnate in the near future and is prompting some investors to sell and invest in new upcoming areas that could offer better returns.
Property prices in Dubai have increased several times, surpassing the 2014 peak last year due to unprecedented demand seen in the post-pandemic period.
Interestingly, buyers who purchased properties during the pandemic year have seen their asset prices appreciate by up to 200 per cent and many of them are now turning sellers to take advantage of the gains made in recent years.
According to a study by Best housesSellers are currently in an advantageous position, taking advantage of an increase in real estate transactions and escalating prices driven by increased buyer demand.
“One of the key benefits for sellers in this rapidly expanding market is the potential for a lucrative return on investment, as homeowners currently enjoy favorable rates. Additionally, selling property in Dubai offers the advantage of no capital gains and no property taxes. “Dubai’s rapid population growth further amplifies property demand and prices, creating an advantageous landscape for sellers, particularly in areas with limited supply.”
saying Louis Harding, CEO of Betterhomes.
Toni Abou Jaoude, commercial director of BetterhomesSuch optimal sale occurs when the price achieved results in a substantial profit, allowing for reinvestment in additional properties after the sale.
“This serves as a strong motivation for sellers to take advantage of current market conditions and use their profits to reinvest in more properties.”
he said.
Abou Jaoude said that by analyzing data trends, a seller’s market in Dubai means strong demand, limited inventory and a consistent trend of offering high returns to both investors and end-users.
“However, in the last two years, purchasing demand among end users has doubled, driven by an unprecedented escalation in rental prices across the city. “This makes it a seller’s market for those looking to make a profit on their real estate investments.”
he said.
Abou Jaoude revealed that properties purchased during the pandemic year have seen a significant increase in value, ranging from a conservative estimate of 50 percent to as much as 200 percent in certain areas.
best housesThe sales manager explained that the best performing areas in terms of profitability are Downtown, District1 MBR, Jumeirah (including communities such as Bulgari, La Mer, Nikki Beach, MJL and Jumeirah private villas), Dubai Hills, Palm Jumeirah and DIFC .
Headwinds in 2024
Mayed Alrashdi, Research Analyst at Emirates NBDsaid the emirate’s property market ended 2023 on a resilient note, achieving important milestones even as interest rates peaked, thanks to population growth and an influx of high-net-worth individuals.
However, he believes Dubai’s property market could face
“Some headwinds in 2024, including continued high interest rates, declining affordability for the average household, and growth in the supply of new units.”
It added that the impact of high interest rates last year was reflected in a 7 percent year-on-year decline in the total value of mortgage transactions to Dh125 billion.
“Rapid price growth, coupled with the high interest rate environment, has impacted housing affordability for the average household. The expected increase in supply, which will comprise 41,500 apartments and 18,500 villas in 2024, should help stabilize residential property prices this year.”
he added.
News Source: Khaleej Times
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