Villa Sales Increase in UAE Property Market - Fajar Realty

Villa Sales Increase in UAE Property Market

The UAE real estate market, is bouncing back after Covid-19’s impact. The sector appears affirmative after a long-term price decrease. In January 2021, villas in places like Palm Jumeirah, Business Bay, The Lakes, and the Jumeirah Islands saw a slight price boost.

According to ValuStrat, the value index for 2021 is over 14% lower than last year. Dubai’s VPI — Dubai index residential capital assets remained at 65.3 points stable compared to 79.1 points in the previous year. This shows instability in Dubai’s capital worth. They also showed a decrease in villa sales and a modest decrease in future matured villa developments.

 

  • The exponential increase in demand for villas ready to move

The demand for villas and urban houses in Dubai has grown by more than 500% from May 2020, when citizens decide to change their living conditions.

The leading cause for the increase in sales of secondary villas and townhouses is establishing an investment property market for non-GCC residents.

  • Significant increase in cash transactions

The trend to buy villas through cash-based transactions has increased. According to Construction Week, cash transactions accounted for 59 percent of last November, with 14.4 percent, monthly gain in cash-based transactions, and ready-to-use home purchases increased by 22.3 percent.

  • Prefer ready-made homes to unplanned buyers

Buyers purchasing ready-made properties in unexpected homes have increased exponentially. ValuStrat data shows that the number of transactions for mass-produced homes grew 18.1 percent, while unplanned houses dropped by 51.5 percent significantly. Off-plan sales have increased at a lower monthly rate of 9.4 percent.

  • November 2020 Key Highlights

These are the essential highlights of November 2020

  • The top three developers of Emaar, Nakheel, and Damac remained.
  • Dubai Marina, Jumeirah Village, Business Bay, Palm Jumeirah, and Town Square were the best places to buy or rent homes.
  • Despite the higher costs, villas saw sales growth compared to apartments, as prices per sq ft were lower.
  • Apartments located in critical districts such as the Jumeirah Beach Residence, Dubai Sports City, saw their capital worth fall by 0.9 percent every month.
  • Unplanned locales like Jumeirah Village, Tilal Al Ghaf, the business bay, and downtown Dubai were the most common transactions.

The price and demand of villas are substantially higher than apartments.

  • Abu Dhabi is witnessing a steep drop in Villas rental rates

The UAE’s Capital also saw a dramatic fall in villas and housing prices due to poor market circumstances and a loss of jobs due to the coronavirus. Many properties have become unoccupied as renters fled for their place of origin. Residence permits are related to employment in the UAE, and ex-pats are to leave the nation as soon as they lose their work as a matter of urgency.

With many people departing Abu Dhabi after being let off by their companies, average rents for villas dropped 3 percent in 2020, compared to the average 5 percent decrease for flats, according to ValuStrat Real Estate Consultancy.

  • Rose First Time Villas Prices since 2015

According to Bloomberg, Abu Dhabi-based Villas prices have shown a declining trend over the last five years. However, the value of villas in UAE capitals increased by 2 percent due to the high demand for properties in the Covid era. Due to higher GDP and per capita income, the Abu Dhabi villas make up nearly one-third of the residential supply. Apartment prices decreased by 4 percent.

  • The decrease in the property’s rental value

Data provided by ValuStrat show that Abu Dhabi’s average home value declined dramatically by 9.5% to AED772 per ft in Q4 FY20. However, the data also forecast the stabilization of rentals and equity at established villa and apartment buildings shortly, due to balanced new supply.

  • Drivers of growth

The key factors of growth that promote the increase in 2021 sales of flats and villas are as follows

  • Positive market feelings due to Sinopharm roll-out
  • Experts estimate that the market feelings would be favorable because of the deployment of Covid vaccination – Sinopharm.
  • Non-oil GDP growth:
  • The rating agency Fitch Ratings anticipates a 2.2% increase in non-oil GDP in Abu Dhabi.
  • Initiatives of the Government:

The UAE government’s programs, such as Golden Visas and FDI Laws, Cohabitation Laws, Expo 2020, etc., aim to encourage millions of international professionals to reside in the UAE. This will stimulate Villas’ demand and positively impact both the economy and the immobilizing sector.

Leave a Reply

Your email address will not be published. Required fields are marked *

Prypto Mortgage

WhatsApp