The Dubai real-estate market registered the biggest number of home and office deals in Q1 of 2021, as per the report by ValuStrat.
“A positive trend which commenced [during the] 2nd half of 2019, cut short by the COVID-19 restrictions last year, appears to have now re-emerged with improved investor confidence-boosting demand, with a record number of title deeds registered and price growth currently evident in some sectors and locations,” the report said.
The ValuStrat Price Index (VPI) for the residential market provided an average quarterly rise of 0.8%, as the initial three months of the year witnessed accelerated positive trends for the first time since 2014.
The valuation-based index tracks change in capital values for a representative fixed basket of properties.
All established freehold villa locations observed by the VPI saw capital qualities improve since the last quarter, going from 1.8 percent to 5.4 percent, the report said. However, just 50% of apartment areas improved in value, a few zones saw decreases of up to 2.8 percent. On a yearly basis, all areas saw value drops, some in single digits.
“Best performing freehold areas were International City, Arabian Ranches, The Meadows, The Lakes, and Palm Jumeirah. Citywide, residential capital values were 10.9 percent lower than the same period last year.”
The Dubai VPI for residential rental values remained at 61.9 points, stayed stable quarterly for the first time in two years. The normal residential yearly lease in Dubai was 76,910 dirhams, apartments at 55,000 dirhams, and villas at 211,485 dirhams. Dubai’s residential net yields averaged 6.1 percent, with apartments at 6.4 percent and villas at 4.9 percent.
The ValuStrat Price Index for workplaces remained generally stable on a quarterly basis, growing a minimal 0.1 percent QoQ at 59.5 points. On an area level, Dubai International Financial Center, Jumeirah Lake Towers, and Downtown Dubai acquired 6.8 percent, 2.3 percent, and 3.8 percent respectively.
The first quarter saw the highest recorded number of home sales transactions since 2010, the report said. There were deals of more than 6,000 prepared homes worth 13.5 billion dirhams and 3,600 off-plan properties worth 5 billion dirhams.
On the supply side, the quarter saw the completion of a total of 36,015 units of which 27,435 were apartments and 8,580 were villas/townhouses. For 2021, the estimated upcoming supply as of now remains at 46,316 apartments and 10,563 villas and townhouses.
Meanwhile, residential rents fell 11% year on year. Recorded rents were down 18.4 percent for apartments y-o-y yet hopped 3.9 percent for villas, a record increment since the base year, as per ValuStrat.