Luxury home buyers drove up Dubai’s home prices as the property market grew by 21 percent in the runup to the United Arab Emirates’ 50th National Day on December 2, according to a report by property consultant Knight Frank.
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September saw the value of home sales reaching a monthly record of $3.3 billion (AED12.2 billion). Sales declined slightly in October, however, to $3 billion (AED11.2 billion).
The overall value of villas rose 14 percent since the beginning of the COVID-19 pandemic.
Knight Frank’s report highlighted a disparity between luxury homes and more affordable properties – as apartment prices rose in high-end areas, such as The Palm Jumeirah (14 percent) and Downtown Dubai (eight percent).
Average apartment prices, however, were down by 3.1 percent.
“There are very early signs to suggest that 2021 may… end up marking the peak of Dubai’s third property cycle,” Faisal Durrani, Head of Middle East Research at Knight Frank said in a statement.
“While values are still creeping up, anecdotal evidence points to an emerging delta between seller and buyer expectations, a classic sign of a rising market that may soon stall.”
Home values overall were down by 29 percent from the 2014 peak.
Durrani went on to say: “Average transacted prices are up 21 percent so far this year but remain 20 percent below the pre-global financial crisis [2008] peak.
“Dubai’s relative affordability compared to other global gateway cities has been instrumental in driving its popularity and it wouldn’t be in the interest of market stability for prices to race past the 2008, or indeed 2014 peaks over such a short period of time.”
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