Dubai’s property market is showing signs of recovery, with strong demand for luxury homes and the introduction of the Dh2m Golden Visa scheme driving the best Q1 sales in 10 years.
According to data from Dubai Land Department, property transactions in Dubai reached a total of Dh35.6 billion ($9.7 billion) in Q1 2021, up 27% from the same period last year. The number of transactions also increased by 4% to reach 11,066.
The strong performance was driven by a surge in demand for luxury homes, particularly in the high-end segment of the market. Sales of villas and townhouses increased by 67% in Q1 compared to the same period last year, while apartment sales increased by 19%.
Another factor contributing to the strong sales figures was the introduction of the Dh2m Golden Visa scheme, which allows foreigners who invest in Dubai’s property market to obtain a long-term residency visa. The scheme, which was launched in 2019, has been a major draw for wealthy investors from around the world.
The combination of strong demand for luxury homes and the Golden Visa scheme has created a perfect storm in Dubai’s property market, with many buyers eager to take advantage of the favorable conditions.
Commenting on the strong Q1 sales figures, Sultan Butti bin Mejren, Director General of Dubai Land Department, said: “The strong performance of the real estate market in Q1 2021 confirms that Dubai has overcome the challenges posed by the pandemic and is on the path to recovery.”
He added: “The introduction of the Golden Visa scheme has played a key role in attracting investors to Dubai’s property market, and we expect to see continued strong demand in the coming months.”
The positive outlook for Dubai’s property market is also reflected in the latest data from leading property consultancy Knight Frank. According to the firm’s Prime Global Cities Index, Dubai’s luxury home prices increased by 1.7% in Q1 2021, outpacing the global average of 1.3%.
Dubai’s property market has been through a challenging period in recent years, with oversupply and declining prices leading to a downturn in activity. However, the market appears to have turned a corner, with a number of positive indicators pointing to a more positive outlook. This includes an increase in the number of transactions, rising rental yields and an overall improvement in market sentiment.
The Dubai Land Department (DLD) recently announced that the total value of real estate transactions had increased by 11% year-on-year in 2019. The DLD also reported a healthy growth in both residential and commercial property sales, with a 6% increase in the number of transactions overall.
Despite this positive news, prices remain largely unchanged. This is partly due to the large amount of new supply that continues to enter the market and the fact that investors are shying away from speculative purchases.
In addition to strong sales figures and rising prices, Dubai’s property market is also benefitting from the government’s efforts to diversify the economy and attract foreign investment. The launch of initiatives such as the Dubai 2040 Urban Master Plan, which aims to transform the city into a leading global destination for business, leisure, and living, is expected to drive further growth in the property sector in the coming years.
The positive outlook for Dubai’s property market is also attracting new players to the market. In April, leading property developer Emaar announced the launch of a new subsidiary, Emaar Development, which will focus on developing residential and commercial projects in Dubai and other key markets around the world.
With strong demand for luxury homes, the introduction of the Golden Visa scheme, and a range of government initiatives aimed at driving growth, the future looks bright for Dubai’s property market. While challenges remain, such as the ongoing impact of the pandemic and rising competition from other global cities, the signs are positive for investors looking to capitalize on the opportunities in this dynamic and rapidly-evolving market.
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