In Dubai in the first quarter of 2024, developers from both domestic and foreign companies are launching projects at a rapid pace—on average, more than one launch per day.
Based on preliminary data from Cavendish Maxwell’s Property Monitor, almost thirty new off-plan projects were launched in March 2024, with 10,000 units coming up for sale over the month.
“These projects now bring the total number of launches in first-quarter of 2024 to an unprecedented 34,000 units spread over 120 projects — an average of a new launch every 18 hours,” said Zhann Jochinke, director of marketing and research at Cavendish Maxwell.
“This phenomenal level of activity in the off-plan market shows no signs of abating anytime soon, and will likely continue for the foreseeable future, with the pipeline of projects in the planning phase being tracked by the Property Monitor team well exceeding 100 additional projects across existing master communities,” Jochinke said in the monthly report.
Developers are starting new projects in Dubai due to the market’s unprecedented demand for real estate.
The Dh55 billion Heights Country Club and Dh41 billion Grand Club Resort by Emaar Properties, the Dh2.4 billion Diamondz and Dh3 billion Bayz101 by Danube Properties, the Dh700 million tower in Jebel Ali by Deyaar Development, the Dh22 billion Arabian Hills Estate by Aqua Properties, and numerous other major projects by domestic and international developers are just a few of the notable projects that were introduced this year.
In addition to lower prices—which are significantly lower than those in the majority of the world’s major cities—the demand is fueled by foreign investors’ confidence in the local real estate market.
Sales record
According to Property Monitor, sales transaction volumes also continued their seemingly unstoppable ascent, surging by an impressive 14.7 percent in March to reach a total of 13,664 transactions. “Not only does this set a new record for March but it also registered as the second-highest monthly sales volume ever recorded. Residential transactions, encompassing apartments, townhouses, and villas, accounted for the majority of sales at 92 percent or 12,565 transactions,” it said.
7,768 off-plan Oqood transactions were recorded in Dubai in March, a significant increase of 21.7% from the previous month and a 3.3% increase in market share to 56.9%. Since 2009, these transactions have been the highest on record.
Challenges for new developers
“This plentiful buffet of projects and the choice that comes with it may present an increasing challenge for developers, as competition will be fierce, buyer expectations high, and greater scrutiny given in selecting the best investment. Well-established and larger developers will be best positioned to capitalize on the mass market across the majority of price points, while niche developers that focus on the luxury and ultra-luxury segments will also be in positions of strength, with fewer projects launched and a laser focus on their target markets,” Jochinke said.
He cautioned that the more recent entrants might find it difficult to differentiate themselves and might have to go back to providing conventional terms that are biased toward buyers, like giveaways, post-handover payment plans, and developer-paid DLD transfer fees.