Staff Writer: Khaleej Times
July 5, 2023
Property prices in Dubai are enjoying their best phase ever and the current bull run in the emirate’s real estate market is different from the two previous peaks in 2008 and 2014. According to a leading expert, prices are unlikely to come down in the near future.
“There is still enormous potential and prospects for both Dubai and the UAE as a whole. In particular, Dubai has found itself in a unique situation between the West and Asia, attracting all streams of commerce and talent,” Alex Galtsev, founder of Realiste, an AI-based proptech firm, told Khaleej Times in an interview.
Galtsev stressed, “Now in Dubai, there is a sophisticated infrastructure and legal framework (such as Escrow accounts, and so on). The entire construction is currently being financed mostly with cash from many countries, diversifying extensively. There are great opportunities, and real estate is still highly undervalued,” he added.
Comparing Dubai’s real estate to other major cities like New York and London, Galtsev said prices at The Big Apple are currently about 2.5 to three times higher than in Dubai. In London, the most expensive areas are about $15,000 per square metre, about double the price in Downtown Dubai. “However, the properties commanding such prices in London are not of a luxury format and are mostly old. In Dubai, the city centre near the Burj Khalifa, Downtown, is priced at $7,500 per square meter, which is half the price and the quality of real estate is twice as good. So, the difference in terms of quality and price is approximately fourfold,” he said.
According to Realiste’s AI platform, the best-selling areas in Dubai are Downtown and JVC, and very soon, Sobha Hartland and Creek Harbour will also join them and already rank in the top five districts.
AI making real estate deals more transparent, Galtsev said. “The more transparent the real estate market is, the more it attracts investors and clients. When you see that everything is transparent, you are not deceived, and you can confidently make purchases and earn from rentals or market growth. Of course, the more transparent the market is, the larger its volume becomes,” he added.
On the recent spurt in the launch of branded residences, Galtsev says it increases the property’s value by 25 to 40 per cent. “It does increase tourism and attracts attention from investors,” he added.
Galtsev predicts that the real estate market in Dubai will continue to grow rapidly for another three years. “This year, 2023, will be the biggest in terms of transaction volume and property value growth. Over time, the rate of growth will decrease, but currently, it’s the peak opportunity to enter this market. The risks are visibly lower now compared to when the market entered the Covid-19 pandemic,” he said.
Galtsev believes this time the Dubai market will not repeat its previous cycles of boom and subsequent decline because the market is becoming digitalised and transparent. “People understand the value and quality present in Dubai, the UAE, and the cities themselves in terms of safety, cleanliness, tourism, and more. The prospects are much greater than in any other city in the world,” he added.