Ishrath Jaigirdar,
Dubai, UAE
Dubai’s property market is experiencing a surge in demand for affordable homes. While luxury properties are yet to meet the unprecedented demand caused by the influx of High-Net-Worth Individuals (HNWIs) into the emirate, likewise, mid-range housing supply is also falling short in the market. Lack of enough supply has caused both market segments to witness a rise in sales price in 2023.
Based on an annual report by dubizzle, the average price per square foot for affordable apartments in Jumeirah Village Circle (JVC) increased by 18.92 percent, standing at Dh1,120 in 2023. Moreover, its impressive Return on Investment (ROI) of 7.54 percent contributed to the price rise following a growing demand among buyers. Additionally, Dubai Silicon Oasis and International City with ROIs of 8.59 percent and 7.62 percent respectively saw similar price hikes.
Consequently, the demand has created opportunities for developers to expand their portfolios of affordable homes. According to Jones Lang LaSalle’s (JLL) latest findings, the residential segment that is most in demand falls below the Dh3 million threshold. Xperience Realty noted 64 percent of property purchases were made in this range, signifying that most of the buyers are seeking affordable portions due to increase in rents. Furthermore, around 30 percent of new residential projects in 2024 will fall under the mid-market category.
In 2023, Dubai boasted a record-breaking Dh634 billion worth of transactions. With around 34,000 units expected to be delivered in 2024, the projected transaction volume will stand at Dh2.6 trillion by the end of the year. James Allan, CEO, Middle East and Africa (MEA), JLL, said, “A robust and resilient real estate industry has established itself as a firm pillar of the UAE’s diversification agenda and is expected to deliver a strong performance in 2024 even under inflationary pressures. The positive outlook for growth and upward trends in the investment climate offer stability in a time of global uncertainty, reinforcing the UAE’s position as an attractive choice for regional and international real estate investors.”
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Also read: Dubai prime market leads globally as capital value jumps 17.4% in 2023
