Pent-up demand drives record revenue for Dubai property broker

Its CEO Lewis Allsopp said business done in January was the most in the company’s 13-year history while enquiries in the month also broke records.

The brokerage recorded a 64 percent revenue increase in January compared to January 2020, building on the momentum of a 22 percent increase in revenue generated in 2020.

Allsopp said: “2020 was a year of the unknown and the same can be said for 2021 but we have been surprised yet again. We received 38 percent more buyer enquiries and 24 percent more tenant enquiries this month when compared to January 2020 – over 5,000 enquiries overall and the most we have had in 13 years in business.”

He added that on January 26 the company broke its record for the most revenue generated in a single month. “It’s incredible how motivated buyers are and how quick the market is moving after such a turbulent year,” he said.

Allsopp, pictured below, deemed the increase in loan to value (LTV) as the unsung hero of the real estate market as the company’s mortgage services unit had a 498 percent revenue increase in January compared to the same month in 2020.

Of the property sales done in January, 88 percent of these were bought by first-time buyers with 93 percent of these taking advantage of the increase in LTV.

Allsopp added: “The increasing number of first-time buyers entering the market since the increase in LTV is very encouraging and even more so that they are still emerging. It goes to show the confidence Dubai residents have in the city.

“It seems like the pandemic has encouraged people to make bold decisions with a ‘why not’ attitude – if they have the money to buy their first home, they are doing it.”

He said the lettings market has suffered slightly as a result of the UAE lockdown and the pandemic with tenants succumbing to job losses and pay cuts encouraging them to re-negotiate their current rental contracts and in some cases, extending on a monthly basis.

This had a negative impact on the leasing price of properties as Allsopp & Allsopp recorded a 9 percent decrease in average rental price of properties and an 11 percent decrease in rental transactions last year when compared to 2019.

“However, we are already seeing a recovery with a record number of transactions and tenant enquiries before we even finish the month,” he added.

He said luxury home rental enquiries have been particularly strong this month.

“After a turbulent 2020, many tenants have entered the new year looking for a new start and a new home. Luxury rental properties on Palm Jumeirah and Jumeirah Golf Estates have been in high demand in January from people who have recently moved to Dubai and from residents looking to upgrade to a larger property with more bedrooms and outdoor space. With prices being low, people are taking advantage and snapping up these properties whilst they still can. Supply in the luxury market is low and we can see this having a slight effect on pricing if the property is of the highest quality,” he added.