Real Estate Market in 2021
Dubai’s real estate market is currently witnessing an interesting curve. While 2020 came with its set of factors that affected not just the real estate market, but the world at large, it also boosted reforms in Dubai’s property laws and residency visas.
In 2020, the property market had a massive decline in terms of pricing and rent. This has also been the time that saw a very high number of transactions in this sector. December 2020 had the highest number of transactions in a month within the last two years. With a very visible shift towards the secondary market, the off-plan sector saw a decline. Not just in terms of prices but also the number of launches, which have dried off over time and developers are slowing down the new phases.
2021 has witnessed an increase in the demand for rental properties and the resale properties. This is a result of the falling sale and rental prices. Another major driver for 2021 to be a stronger year for Dubai’s property market are the government aid and visa reforms that have been announced. From residency visas to citizenships, as well as a committee dedicated to overseeing supply and demand in Dubai’s market.
Not just that, Dubai’s government is currently doing a brilliant job of getting all residents and citizens vaccinated, which is also helping in restoring the current market. Currently, the lower interest rates and the amazing LTV ratios for first-time buyers are also major drivers in the market. With Expo 2020 coming up in October 2021 and the 50th National Day in December 2021, this year is seeing positive growth in comparison to the previous year.
The office market has seen a decline in the rental market as well as sales, given the current situation where a lot of people are currently working from home and the big companies are deferring their office space decisions to the next year. However, the logistics and distribution, eCommerce and cold storage businesses have been booming and therefore driving higher demand for warehouse spaces in Dubai.
According to Sultan Butti bin Mejren, the Director-General of Dubai Land Department, Dubai has a robust investment environment. Given its adaptive nature to various circumstances, Dubai is guided by the strategic vision of its leaders. This helps to strengthen the efficiency of the property market in Dubai.
According to the data posted by Gulf News, the foreign investors’ list is topped by Indians, with the Chinese following right after. The list then includes the British, Pakistanis and the French after that. With over 19K foreign investors, the total worth of investments that were closed amounted to over AED 35 billion.
In conclusion, 2021 is set to see a probable decline in the property prices, although at a slower rate. With the demand-supply ratio heading towards stability, Dubai’s real estate market has remained relatively resilient to the effects of 2020 and is set to get stronger.