Has COVID-19 Impacted the Selection of Real Estate in Dubai?

What was the impact of the Coronavirus pandemic on the UAE economy and the Dubai real estate market? What are the impacts of the introduction and removal of COVID restrictions on housing prices? What has changed in the Dubai property market after the lockdown and which areas are gaining popularity now? We will discuss it in our article.

Content:

• The influence of COVID-19 on real estate sales in 2020
• What comes next for the Dubai real estate market?
• Popular districts in Dubai
• Assistance with acquiring property in Dubai

The Influence of COVID-19 on Real Estate Sales in 2020

At the initial stage of the pandemic, real estate sales in Dubai remained high, which is a fact that depicts the optimism of investors. Many of them bought housing units remotely. However, despite the favourable situation in the metropolis, COVID-19 has still caused consequences in the life of the city. Dubai was put under quarantine and several restrictions were introduced. During this time, property sales and prices dropped considerably.

For the period of January-June 2020, the Dubai Land Department (DLD) registered 15,897 sales transactions at a price of a total of AED 32.5 billion ($ 8.85 billion). The average real estate price decreased by 4% compared to the first half of 2019.

In a side-by-side comparison, a decline could also be observed, as the housing costs in the Dubailand area dropped by 2% per square meter, from AED 1,277 ($ 347) in the second half of 2019 to AED 1,252 ($ 340) in the first half of 2020.

In Dubai Marina, studio prices fell from AED 694,000 ($ 189,000) to AED 648,000 ($ 176,500). For one-bedroom apartments, they declined from AED 1.11 million ($ 302,000) to AED 1.6 million ($ 435,500).

Real estate in Jumeirah Village Circle, Jumeirah Lake Towers, Business Bay, Dubai Silicon Oasis, and Jumeirah Beach Residence fell in price by 6% during the quarantine period.

The market began to recover after the gradual lifting of restrictions in June 2020. This was facilitated by the introduction of online tours and remote purchases by the majority of real estate agencies and construction companies. They were available in some companies even before the borders were closed.

As early as 2021, a record-setting 84,196 real estate purchase and sale transactions were concluded in the emirate, worth a total of almost AED 300 billion ($ 81.6 billion). The average house price increased by 9.2% in Dubai.

What Comes Next for the Dubai Real Estate Market?

Increased consumer interest in villas can be considered another effect of the pandemic. As a result, their prices also increased in 2021.

Here are some examples indicating how the Coronavirus has affected housing selection in Dubai. The price per square meter in Arabian Ranches is currently AED 987 ($ 268) compared to AED 880 ($ 239) last year. A four-bedroom villa here will cost AED 3.65 million ($ 994,000) compared to AED 3.57 million ($ 972,000) in 2020. Five-bedroom homes also grew in price, from AED 4.44 million ($ 1.2 million) to AED 4.58 million ($ 1.24 million).

In Palm Jumeirah, a three-bedroom villa now costs AED 5.16 million ($ 1.4 million), a four-bedroom option has a price of AED 9.22 million ($ 2.5 million) and a five-bedroom villa, AED 16 million ($4.35 million).

In Emirates Hills, a five-bedroom villa can be purchased for AED 20.5 million ($ 5.58 million) and a seven-bedroom villa, for AED 38.1 million ($ 10.3 million).

Villas in the following areas are also in great demand:

• Springs;
• Jumeirah Park;
• The Villa;
• Dubailand;
• Damac Hills;
• Dubai Hills Estate.

Popular Districts in Dubai

According to the Dubai Land Department, buyers are more interested in the following neighborhoods:

• Dubai Marina;
• Arabian Ranches;
• Palm Jumeirah.

The new complexes, like Dubai Hills Estate and Damac Hills, are located near the major highways of the city. For this reason, they are also in high demand among buyers.

Interest in the Albizia project in Akoya Oxygen has also been high, where there are land plots, cottages, and townhouses for sale. You can become the owner of a local villa for AED 760,000 ($ 207,000).

Another popular location is the Rukan residential complex in Dubailand. It is perfect for people who do not appreciate the hustle and bustle of the metropolis. Life here is quiet and slow.

If you are looking for off-plan projects, pay attention to Jumeirah Village Circle, Downtown Dubai, Palm Jumeirah, and Business Bay. Here, luxury real estate is currently in the process of construction or coming up soon, but property developers are willing to make concessions with the payment plan. This can be discussed specifically during a negotiation.

Off-plan cottages are available to purchase in the communities of Golf Place in Dubai Hills Estates and Sobha Hartland in Mohammed Bin Rashid City. In addition, facilities close to the Expo 2020 venue, such as Emaar South in Dubai South, are already in use.

Assistance with Acquiring Property in Dubai

The real estate agency, AX CAPITAL, accompanies investors in the selection and registration of property in Dubai. The company’s representatives are ready to provide you with their services. Contact our team today, and we will assist you in finding the best buy-to-live or buy-to-invest option.