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The S&P Global Ratings organization have recently posted positive remarks on Dubai’s real estate, furthermore, forecasting over 30 per cent growth in revenue towards to the end of this fiscal year.

According to the latest data from Property Finder, the year-to-date total sales value reached AED 61.97 billion while June was the highest real estate sales transactions occurred since December 2013 with 6,388 deals worth of AED 14.79 Billion.

The June made the 8 years monthly sales volume data soared by 44 per cent and by 33 per cent in terms of value.

This stupendous rebound was perceived to be driven by strong demand from investors, and end-users on the back of economic come back spurred stimulus package by the government along with the speedy vaccination and attractive visa reformations.

Recent analysis of ValuStrat shows monthly performance on ready-to-move-in homes sales rose by 75 per cent and Oqood (contract) registrations increased by 59 per cent. Compared to previous quarter performance which is Jan to Mar; April to June quarter shifted by 7,500 transactions.   

The luxury market brings more global attention

“The rebounding of Dubai’s luxurious market brings more global look, perhaps signaling the beginning of a ‘Roaring Twenties Era’ for world property market,” said Faisal Durrani, the head of Knight Frank’s MENA Research Department. Dubai’s prime real estate market sales have surpassed 2020’s total economic activity, particularly tourism, has rebounded in the past six months on the back of one of the world’s fastest vaccination campaigns.

According to data from Anarock, Indians bought 16 per cent of the housing in Dubai by sales volume – boosting it over AED 8 billion in 2019. Their interest in Dubai real estate has only increased since the pandemic– 2020’s first quarter which saw a growth of 15 per cent in the number of transactions of property in comparison to first quarter of 2019.

“With average home prices floating at AED 900 per sq ft and banks proposing lowest interest rates and up to 85 per cent high LTV, it has become more affordable for average households to buy their permanent homes,” says Haider Tuaima, head of real estate research at ValuStrat.

Positive Outlook

“We are seeing the market already bouncing back. The market, across the board, has seen an uptrend. For instance, in March this year the prices have increased by 1.3 per cent in the citywide. This is, in fact, the first year-on-year increases in prices we have had since late  2015. Ever since the real estate market hit the bottom in during 2020 pandemic, the prices have recuperated up to eight per cent now,” states Ayman Youssef, VP at Coldwell Banker UAE.

Sentiment in Dubai is better now as the whole world realized how efficient it handled the pandemic situation. Consequently it led many affluent buyers to consider Dubai as their second home or to put their speculations in.

“We have seen a lot of international and local buyers moving to Dubai especially into the luxury segment because of the striking prices and eases of pandemic lockdowns. We are witnessing a significant history for the Dubai luxury property sector. Properties cost above AED 10 mil. have seen highest market share which is 2.5 per cent,” Youssef said.

Occupancy in smaller flats or B grade flats are low

Mr Youssef mentions Dubai’s occupancy in grade B homes is low now; “This is because many prefer bigger or more bedroom villas to current apartments due to the new working-from-home trends and the need for bigger spaces and amenities surrounded by greener areas. We also see a rise of demand in waterfront units”.

Stable Growth

Prathyusha Gurrapu, head of research and advisory at Core, said due to various demand drivers, transaction activity has seen steady increase, particularly in the secondary market with a 64 per cent increase in transaction activity over the first quarter this year compared to the same quarter of 2020.

“On the other hand, off-plan market activity continues to face headwinds, contracting by 29 per cent over the same period. That said, we foresee steady absorption for near completion off-plan projects from select major developers over the remainder of 2021 as demand and sentiment improves with developers focusing on existing under-construction projects and deliveries,” Gurrapu told Khaleej Times.

Leverage of Rises

Highlighting the top five growth drivers for property in 2021, she said UAE’s high vaccination rates, safety and business continuity for businesses and residents; relatively easy access to finance — lower LTV values and lower interest rates making it easier to climb the property ladder; visa and social reforms; a raft of fiscal incentives and government measures to support the economy; and Expo 2020-led positive economic sentiment will further strengthen market sentiments.

“Despite high rates of vaccinations, due to the very nature of the pandemic and its ever-changing impact on global tourism and mobilization, we are yet to say with certainty that we are in a sustained recovery phase. That said, with strong fundamentals, business resilience and investment interest, most market stakeholders hold a positive market sentiment and remain cautiously optimistic for a steady 2021 on the back of efficient government measures,” she added.

Dubai’s booming economy is attracting start-up companies from across the globe. With its reputation for safety, quality education, and transportation options (not to mention fantastic healthcare), Dubai has quickly become a hub of innovation in an increasingly globalized world.

Although foreign direct investments are declining globally at 42%, this trend does not seem to be affecting Dubai. In fact, we have seen an increase in FDI from $1.5 trillion last year (2019) up until 2020’s current volume of 859 billion dollars–a testament that our economic stability continues to grow despite these difficult times.

Dubai has risen to become a leading-edge technology place within a short period of time. Home of some of the most profitable companies in many sectors, including AI and biotech industries that are bustling with innovation; Dubai is also a safe haven where supporting Fintech, blockchain businesses, and even sustainable food products and solid food waste using lean technologies.

Despite the challenges posed by a global decline in FDI, Dubai has been able to keep its economy stable and is now attracting high volumes of international investment.

Silicon Valley On Steroids

Dubai has been called a “Silicon Valley on steroids” by Forbes. There are many cutting-edge companies in the Middle East, but Dubai’s tech community is especially impressive because of its diversity and size.  There are 38 free zones in the UAE that offer tax exemptions on withholdings, export, corporate and personal income as well as corporate tax exemption for 50 years from the date of the company’s formation.

Dubai now welcomes an estimated 3 million tourists annually as well as international business travelers looking to buy a commercial property and set up shop there due to their low tax rates and innovative infrastructure projects like The Palm Islands which will house 1/3rd of all world’s future population when finished according to 2018 estimates from Bloomberg News!

Jacques Voorhees, a world-renowned diamond expert and founder of the company Icecap Diamonds, speaks about how he was so impressed with how it transformed into this global capital while he was visiting Dubai for Ritossa Business Summit 2020. “I had no plans to relocate Icecap, my company for manufacturing diamonds to the UAE, yet I was beginning to notice things. The Abraham Accords were allowing close interaction between Dubai and Tel Aviv; another center of the diamond trade. It seemed that De Beers (the largest mining company in the world), after recently moving its every-five-week “Sights” from Africa to Dubai, planned on staying here with all it’s primary competitors already present—cutting 90% of Earth’s precious gems right next door!

Dubai will be the leading financial hub in the region with a positive attitude towards blockchain technology.

Blockchain

Jimmy Nguyen, Founding President of Bitcoin Association stated that the BSV blockchain is meant for large-scale applications and can be used in smart cities or to deliver e-government services. He also claimed that Dubai’s government ministries are serious about implementing these types of technology at a larger scale which would make it easier to create more effective systems than those currently being utilized by other governments around the world.

As an investor, you look for the value-added of any proposition and with Dubai it’s that audacity which energizes. It is safe to invest in Dubai whose first-mover response to this global pandemic has been some of the best out there. Today, people see more than just buying a place for occasional use or as modest protector; now they can find what’s most needed: access to liquidity—and all while incubating ideas in one spot globally!

Opportunities

The UAE is a land of opportunities, and investors can take advantage of the incentives available to them. For example, in addition to benefitting from an array of economic bonuses such as full foreign ownership laws, bankruptcy provisions for commercial companies and long-term residency/citizenship options are made possible here too should one wish it. You also have superior connectivity due to state-of-the art infrastructure which includes just about everything you need – incubators where entrepreneurs can network with other likeminded people who share their vision; accelerators that give these budding business owners access not only funding but mentorships on how they might grow even faster than before! The ecosystem surrounding this country has grown immensely over time so there’s never been better timing than now.

Quick Money

For those looking to make a quick buck, Dubai is also the place. It is one of few countries on the globe where taxes are non-existent which means you can keep everything you earn in your pocket without any left over for Uncle Sam (or Jacquees). In fact, many entrepreneurs have relocated from places like the US or UK because they want tax breaks on their earnings. In addition to being able to save money by not paying taxes as well as saving time since there are no audits either – it’s an all around great opportunity for anyone who needs some cash fast with little investment required!

As a gateway for innovation, Dubai has partnerships with multinational design centers and high-tech startup hubs. They also have strategic priorities that are constantly being enhanced in order to make the journey as effortless as possible.

Leadership

The Emirate is a global hub of business due to its strong leadership, while today international businesses are interested in Dubai because the government supports small and medium enterprises. With Emirati leaders’ support for SMEs (small and medium enterprises), there has been an increase in interest from around the world with many countries expressing their desire to participate at Expo 2020 Dubai as well as other events happening across all sectors including healthcare.

Golden Visa

The UAE’s Golden Visas make it much easier for small businesses to relocate there. This is because they don’t require the applicant, or their employees, to have a sponsor anymore and offers 100% ownership of one’s business that differs from historically required local partners with at least 51%. The intent behind these visas is to provide an opportunity for entrepreneurs who want the freedom and mobility of running their own company but not wanting all risk involved in starting up.

Airport

The Dubai International Airport is the world’s largest and fastest growing airport that supports 100+ airlines, 260 destinations worldwide. The passengers who arrive are entertained by a grand sculpture of the iconic Burj Khalifa with its signature twisting spire which sits on one side of what will become an even more impressive Plaza—the first-of-its kind in North Africa to be situated at such close proximity to both Terminal 1 and 2.

Transportation

Dubai boasts some pretty amazing public transportation systems including excellent Metro options as well as Bus routes; not only does this make it easy for people living there but also makes tourists feel like they can explore without getting lost or exhausted! Some other interesting things about DXB include being home to dozens upon dozens of restaurants

Education

Needless to say that Dubai is a city that highly values education. With over 300,000 students in the private school system and 90% of them being mixed-gender classrooms, Dubai has given its citizens an excellent opportunity to explore their love for learning more than they may have been able too before. The university degree schooling is offered free for the citizens while many more other schools are available for vocational courses as well!

Healthcare

United Arab Emirates is a very progressive nation that has embraced modern health care philosophies implemented. Their top-notch facilities are overseen by an agency called The Ministry of Health and Prevention, which houses four hospitals in the city (Dubai, Rashid Latifa Hatta) with over 40 total spread throughout Dubai. As for their citizens’ healthcare needs, they do not have to worry about it as free clinics abound on every street corner! They also offer affordable treatments at government-owned pharmacies where patients can get everything from prescriptions to dental services without having to wait in line.

Active Lifestyle

There is no shortage of ways to maintain a healthy lifestyle in Dubai. Picturesque beaches, fabulous cuisine, and bustling streets for walking make it the perfect place for residents or guests looking to stay fit. Skiing through polo are some examples from the list of popular sports options that keep people active.

The Dubai government is working hard to make the city of Dubai not just a tourist destination but also an ideal home for residents. This includes initiatives and programs that are planned every day, as well as innovative ideas intended to meet visitor’s needs on an ongoing basis.

Despite the pandemic, affluent people continue investing in Dubai’s real estate because it tops as a dream destination while the wealthy list is led by Indians. A growing number of Indian entrepreneurs are choosing their second homes in Dubai according to Gulf Cooperation Council and Anarock Property Consultants. It says “The quality of life in Dubai is superior to most of the cities of India” could be the biggest factor affecting the movement.

Shajai Jacob, CEO at GCC adds “Also Dubai’s location is well connected to global business destinations”.

Dubai’s properties offer annual rental yields as high as 6-10% which is pretty higher than most developed economies’ benchmark returns.

According to Shajai Jacob, “One million dollar can buy noticeably bigger real estate space in Dubai than world’s other metropolitan cities like London, Hongkong, NewYork, Mumbai and Monaco” he admits.

Moreover, Dubai property market is well planned and regulated; whereas developers are accountable to, and buyers are protected by, a strictly instigated RERA (Real Estate Regulation Authority. The stricter forms make investors safe and far more confident in their investing decisions therefore compliance oriented markets like Dubai is highly attractive to Indian buyers.

The supply has been adjusted since the pandemic, its increased demand will property prices high or upwards in the near future, Jacob emphasizes. Indians are looking for more real estate in volume more than ever.

Since 2017 India has been in the top three buyer nationalities in Dubai due to the real estate investment has emerged as the quickest way to get a residency document in the UAE. As per 2019, 16 per cent of the total volume in Dubai property sales was done by Indians weighing more than AED 8M.

The 2021 Q1 of this financial year, precisely between January to March, Dubai reported 15.5 per cent hike rate as compared to renowned period in 2019.

India’s high profile individuals showed huge fondness in Dubai’s luxurious homes especially since the pandemic got struck. These buyers have been eyeing for Palm Jumeirah, Downtown and Dubai Marina and it’s been shown record sales this years first quarter. Buyers’ attitude or preferences are not constraint on any budget, though looking for best possible options if it allows all accoutrements in place.

Other marquee locations are as followed by Dubai Hills Estate, Meydan and Jumeirah Village Circle as the locations give highly satisfactory ROIs and the investor prices are attractive that it encourages experienced patrons to buy multiple units at the same time.

People’s buying preference on the type of properties depend on the form of their families themselves. Newly married couples show interest in apartments in the primary areas, while larger families are opting for townhouses or villas in more quiet areas.   

We all witness Dubai’s property market has been on a progression track since the beginning of this year.

Each of last few consecutive months until vantage point of June 21’ has been stellar record sales with respect properties market.

Dubai has seen 3,000 real estate transactions worth AED 7 billion in January 2021, which is  a hike by 15 per cent in values and 37 per cent in sales volume compared to 2020.  March was another huge success in 16 months with 4,644 transactions. April saw more transactions that is 4,832 translates to the highest sales happened since March 2017, notes Jacob.

The total sales volume for the quarter selling Dubai homes reached as high as AED 21 B progressing further growth of 5 per cent compared to 2019’s data.  

“A huge part of the sales year by year is driven by Indians,” Mr Jacob adds.

Covid crisis has reformed the way how companies and schools operate and it consequently raised families’ necessity to gather larger homes.  

Many residences and homeowners in UAE are now seeking for upgrade from their initial 2-3 bedroom apartments to more spacious 3 bedrooms or larger square feet villas; while three and a half bedrooms, kitchen and hall (4BHK) are on demand due to its capacity for more flexible living added.   

Besides sales demand, the short term rental homes business is booming with service apartments, because of huge influx of travelers and business professionals finding their homes for a month or even shorter period of time, staying in the city running their businesses.

Jacob mentions short term rental is booming and will maintain its progression in the coming months because of the Expo anticipation and few sporting events to be held in Dubai. Also several multinational events and business related meetings are on the way, ultimately, Dubai is the hub for global events this year.

The emirates rulers and its authorities are operating and soothing all the possible ways to ensure the city is perpetually attractive for speculators. Fast distribution of vaccines and tourism availability with the businesses running like normal are all pushing to approach the pre-pandemic levels.  

In addition, there are few changes have been made to company ownership and individual visa laws in Dubai.

Dubai presently allows 100 per cent ownership of businesses regardless of a local sponsorship and 3, 5 and 10 years of visa programs are being biggest attractions to the aspirant investors who are willing to reside in UAE.