Sales in Dubai's prime residential market totalled AED39 billion ($10.6 billion) in 2018, about 11 percent lower than the previous year, according to new analysis by Luxhabitat.
The UAE luxury real estate firm said the top three areas in terms of sales volume were Business Bay (AED6.9 billion), MBR City (AED6.3 billion) and Downtown Dubai (AED5.4 billion).
Its report said average price per square foot for villas that transacted in 2018 increased, indicating interest for higher end and better quality units.
The report also revealed that more than 5,454 villas and 25,595 apartments were sold in 2018 across the residential market, with the volume of transactions in the secondary market standing at AED74.7 billion, compared to AED82.6 billion in 2017.
Off-plan transaction volumes dropped 34 percent from the previous year to AED23 billion, it noted.
The report added that demand for secondary market villas has doubled as resident families look to move into villa communities, with Arabian Ranches 2 seeing a 47 percent increase in sales from the previous year.
Off-plan investments in apartments remained steady while the data also indicated that it also more expensive to buy off-plan properties than in previous years, a 8.4 percent annual increase.
Luxhabitat said: "Developers will need to offer more incentives than at their current levels. As the supply increases, there is a larger pool of investments to choose from. 2019 looks to be a buyer’s market, with further price stabilisation."
Sales director Andrew Cleator said: “In my opinion 2019 will continue to be a buyer’s market with great opportunities for both investors and end users alike. Saying that price reductions have already started to wane with some areas showing signs of stabilising.
"For sure this year we will see even more bullish developer sales incentives being offered. Last year we witnessed developers offering DLD fee waivers, free initial period service charges and very attractive post completion payment plans.
"The latter was partly due to the UAE central banks reluctance to increase the mortgage loan to value ratio, but I strongly believe this will be addressed in the coming months as part of the current government stimulus plan."
He said other key drivers to positively affect the market in 2019 include the current interest from international buyers and institutional investors especially from China.
Luxhabitat defines the prime residential market 15 key areas including Al Barari, Arabian Ranches, Downtown Dubai, Dubai Marina, Dubai Creek Harbour, Business Bay, Emirates Hills, Jumeirah, Jumeirah Beach Residence, Mohammed bin Rashid city, Jumeirah Golf Estates, Jumeirah Islands, Jumeirah Lakes Towers, Palm Jumeirah, The Lakes, Meadows, & Victory Heights.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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