Samir Salya on The Potential Recovery for Dubai’s Property Market

After years of decline in the Dubai property market, prices are now showing promising signs of recovery. With new factors coming into play, such as population growth and Expo 2020, the future of the market looks to be moving towards stabilization this year. With this, further growth and strength are expected in the market moving forward.

The downward cycle bottoming out

According to data collected by Propertyfinder Group, the UAE’s real estate market could experience a turnaround in 2018. This will mark the end of years of falling property prices in Dubai.

The report notes that the sale prices of properties across Dubai have been falling by single-digit declines across all markets and areas of Dubai. Villas, in particular, have noted significant declines in prices., with Dubai Land falling by 8.2%, Meadows falling by 9.3% Furjan falling by 8.1% and Jumeirah islands falling by 7.1%. These results see Dubai at the bottom of a cycle of decline at the beginning of 2018. Due to new factors, this cycle is thought to be on the uptick, with prices set to rise moving forward.

Expo 2020 marking an upturn

Speaking in the report, Propertyfinder Group’s Chief Commercial Officer, Lukman Hajje, states: “Popular sentiment is that prices are at, or very close to, the bottom of the cycle and will increase in the lead-up to Expo 2020.”

Expo 2020 is set to bring a wide range of investors and consumers into the country. Bringing in a selection of global companies and leaders, Dubai is on track to become a hub for businesses as a result. With major constructions into venues, commercial and retail property being seen, the demand for property once again growing.

Continuing, Hajje comments: “There will also be an increase in product offerings in affordable emerging communities in the sub-one million AED, sub-one thousand AED per square foot segments, which were historically underserved during Dubai’s earlier construction booms.”

Population on the rise

As Dubai is witnessing a population growth, this is likely to counteract against fears of oversupply in the region. Data by real estate portal Reidin notes that population growth is now outpacing new supply by 2 to 1. With 2018 looking to follow a similar trajectory, the demand for housing is set to continue to increase. This strengthening demand could potentially offset the rise in supply that has caused worry in recent months.

Writing in the Propertyfinder report, Gulf Sotheby’s Managing Partner Kalpesh Sampat states: “With real estate prices declining significantly in the last 12 to 18 months, and with the lowest price per square foot across 10 major international cities, Gulf Sotheby’s is predicting that 2018 will see an uptick in the market, especially for the ready segment.”

These changes to the Dubai market look set to stop the recent downfall in prices. With 2018 set to show recovery, the years to come are promising. This will especially be seen as Expo 2020 draws closer.

About Samir Salya

Samir Salya is the Chairman of Reign Holdings and is involved in UK and UAE real estate and construction. Samir holds over 20 years’ experience in executive management, business expansion, performance improvement, sales and marketing.