Dubai’s residential market has seen a significant shift in development and transactions from luxury to affordable units over the last few years, a report by Property Finder has found.
Although Dubai has traditionally been perceived as a hub for luxury properties, with the emirate attracting several high-net-worth individuals from around the world who invest in second or holiday homes, the changing market dynamics has seen property in Dubai become more affordable. Prices are now in reach of several first-time home buyers, who had earlier been priced out of the market, the report added.
Citing transactional data from Data Finder, a real estate insights and data platform under the Property Finder Group, the number of units sold in the luxury segment, both off-plan and secondary, has declined year on year since 2016, the report said.
In 2019 (until end of July), there have been 179 residential units sold in off-plan sales over $1.36 million compared to 12,403 units which were sold under $1.36 million. In the secondary market, 527 residential units sold were over $1.36 million compared to 8,772 units which were under $1.36 million., according to Data Finder statistics.
In 2018, there were 241 residential units sold in off-plan sales over $1.36 million compared to 17,235 units which were sold under $1.36 million. In the secondary market, 1,020 residential units sold were over $1.36 million compared to 14,520 units which were under $1.36 million.
This data clearly shows how buyers are gravitating towards Dubai properties priced below $1.36 million, which can be classified as affordable. Even developers have been quick to gauge this change in market sentiment and have been proactive in launching more affordable projects.
“Over the last few years, there has been a significant shift in development to affordable units in the residential market and the demand has been quite strong. Therefore, the majority of units developed over the last few years have all been in the affordable segment,” said Lynnette Abad, director of Research & Data, Property Finder.
Meanwhile, in 2017, there were 335 residential units sold in off-plan sales over Dh5 million compared to 24,570 units which were sold under Dh5 million. Off-plan property sales had the best showing in 2017 owing to a slew of post-handover payment plans and other developer incentives aimed at attracting new buyers to Dubai real estate.
The secondary market did not fare too badly either in 2017, with 1,273 residential units sold over $1.36 million compared to 12,725 units under $1.36 million.
A year earlier in 2016, 14,591 off-plan residential units were sold under $1.36 million compared to only 329 such homes sold for a value of over $1.36 million. In the secondary market, 12,808 residential units were sold under $1.36 million in contrast with only 1,254 such homes sold for over $1.36 million.