A war of words has broken out about the health of Dubai’s real estate market, with a city-based proptech firm re-assuring investors about an immediate rebound in the market, while pooh-poohing a recent report about a sharp fall in property deals in April, apparently raising red flags about the sustainability of the current bull run.
“Market analysts and investors should consider the seasonality and historical data when evaluating the Dubai real estate market. We caution investors against overreacting to short-term fluctuations and encourage a focus on the market’s strong fundamentals,” Realiste, the proptech company specialising in AI-powered solutions for real estate investment, said in a report.
Read More on the Topic:
- Dubai real estate sales to hit AED300bn in 2023 as HNWIs flock to city
- Revealed: Dubai’s Binghatti unveils new exclusive Bugatti Residences for wealthy buyers
- Dubai real estate sees surge in Indian buyers ahead of tax jump
Allsopp & Allsopp, in a report released last week, said the Dubai real estate market registered a massive 33 percent fall in sales transactions and 18.3 percent in sales value in April compared to the previous month – first time in 2023, since December 2022.
To be fair, the real estate company also clarified that is a “common trend” that is seen during the holidays.
“The dip [in April] was due to several external factors such as reduced work hours, the Ramadan, Eid and Easter holidays, which led to fewer new properties coming to the market, followed by a drop in property sales viewings and less new sales transactions by the Dubai Land Department (DLD), the Allsopp & Allsopp Dubai Real Estate Market Snapshot for April 2023 said.
The report also added that early May data “shows a swift return” to Q1 2023 sales levels.
Analyzing Dubai real estate market trends
Realiste, however, said it does not agree with the Allsopp & Allsopp report.
“According to a recent report, the total amount of transactions in the Dubai property market has experienced a decline in April 2023, with the transaction volume amounting to approximately AED15 billion, down from nearly AED22 billion in March. This decline is seen as a cause for concern by the report,” Realiste said.
“Our AI-based analysis identifies seasonal trends in the Dubai property market and suggests that the recent decrease in transaction volume should be understood within this context,” Realiste said.
It said the historical data indicates a pattern of temporary declines followed by significant recoveries, leading to record-breaking transaction volumes.
“By considering seasonality and historical data, we anticipate a resurgence in buyer activity and a rebound in the market,” Alex Galtsev, CEO and Founder of Realiste, told Arabian Business. “Investors should approach the market with confidence in its long-term prospects and capitalise on the opportunities the market has to offer,” Galtsev said.
DLD’s historical data supports market resurgence after occasional dips
The Realiste report cited DLD’s 2022 data, showing a decrease in transaction volume from AED19.5 billion in March to AED15 billion in May.
“However, the market experienced subsequent recoveries, with transaction volume surpassing AED18 billion in June, nearly AED21 billion in August, and even reaching a record high of AED40.5 billion in December,” Realiste said to buttress its prediction for a major rebound in the market in near-term basis.
Follow us on
