The Dubai real estate market enjoyed its second highest ever April in terms of transactions, according to the latest data. A total of 60 percent of the transactions were in the secondary market and 40 percent in the off-plan market. This represents a 46 percent increase in volume and 67 percent increase in value year-on-year, and comes after a record-breaking March.
April saw a total of 7,009 sales transactions worth $5 billion (AED 18.3 billion) according to data available on the open data platform of Dubai Land Department. It was also the second highest April on record for sales volume and value, with April 2009 being the highest.
“Despite the upward trend we have seen over the last year, it will be interesting to see how the rest of the year will pan out as it will be difficult to continuously beat sales records month-on-month,” said Lynnette Sacchetto, a leading consultant who is recognised as an expert and a thought leader in the UAE’s real estate industry.
Interest rates rose on 5 May by 50 base points (or 0.5 percent), and Sacchetto expects to see another increase in June of 50 base points and at least 100 base point hike by the end of the year. “This, coupled with high inflation and dealing with the various supply chain issues, will most likely cause the real estate market to cool down,” she added. However, she said that because Dubai is unique and has its own characteristics and trends, she expects the luxury segment and popular areas to continue to do well and prices to continue to rise.
Among the top areas for sales transactions in April for villas and town houses was Arabian Ranches 3 for off-plan, and Dubai Hills Estate for the secondary market.
For rents, there was a 4 percent increase in average annual rental amount for villas/townhouses month-on-month. As inflation and interest rates continue to rise, Dubai will most likely continue to see rents increase throughout the year, especially for high demand areas and units, she predicts.
“The population in Dubai recently reached just over 3.5 million and this will only increase due to the various government initiatives enticing talent and businesses to move into this city. This will have an impact on prices as most new residents will rent rather than buy right away. I expect short term rentals will also continue to thrive.”
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