Dubai's property market continues its upward trajectory, with prices rising for the 15th consecutive quarter. This sustained growth is being fueled by strong demand in the affordable and mid-market segments, according to a recent report by Cushman & Wakefield Core.
The report highlights Discovery Gardens, Sports City, and Dubailand as areas experiencing the most significant price increases for apartments. This trend is attributed to a combination of factors, including a growing resident population and an influx of foreign investors seeking attractive investment opportunities. Analysts suggest that even older villas in the city are being snapped up and renovated by owners capitalizing on the hot market.
"There are no signs of the market slowing down anytime soon, " said Prathyusha Gurrapu, director and head of research and consultancy at Cushman & Wakefield Core. Gurrapu pointed to a city-wide increase in sales prices of 20% year-on-year, surpassing pre-pandemic levels by a significant 66%. Notably, price growth appears to be moderating in Dubai's prime locations like Palm Jumeirah, City Walk, Downtown Dubai, and Dubai Marina. In these areas, annual sales price increases for apartments have settled at around 20%.
Experts believe this surge in demand is largely driven by several factors. Dubai's successful handling of the COVID-19 pandemic and its emergence as a global business hub have burnished its reputation as a desirable destination. The emirate's commitment to hosting major events like Expo 2020 has further enhanced its international profile.
Furthermore, strategic government initiatives aimed at attracting foreign investment have contributed to the market's buoyancy. Relaxations in visa regulations, including the introduction of long-term residency visas, have made Dubai a more attractive proposition for expatriates seeking to put down roots.
Looking ahead, market analysts predict continued growth in Dubai's property sector. The steady rise in residential property prices is expected to incentivize developers to ramp up construction activity, particularly in the affordable and mid-market segments. This will help cater to the rising demand for housing from a growing population and ensure a healthy balance between supply and demand.
However, some analysts caution that potential interest rate hikes could dampen investor sentiment. They emphasize the need for close monitoring of market conditions to ensure sustainable growth in the long term.