Detailed overview of the UAE real estate market per emirate

Detailed overview of the UAE real estate market per emirate

Real estate in the United Arab Emirates has always been popular with property hunters from all over the world. After a slight decline in sales caused by the global economic crisis and pandemic, the situation is recovering. Property in Dubai and Abu Dhabi are the most popular options, however the other emirates are experiencing an increase in home sales too. Affordable prices and a high standard of living make real estate in this country an attractive investment solution. In this article, we are talking about the best destinations for property investment.

Table of contents:

General trends in the UAE real estate market

After the borders were closed in 2020, the demand for housing has decreased significantly. However, in 2021, restrictions eased and investors returned to the market, showing an active interest in detached properties with isolated gardens. While earlier the most popular options were small buy-to-let studio apartments, now the first place in sales is taken by villas in Dubai. The increase in sales for the first half of the year was almost 200%.

Properties in the off-plan segment are especially popular. Apartments in new projects are offered with a flexible payment scheme and additional bonuses from developers. The payment schemes and bonuses include payments by installments as well as the payment of a mandatory fee when registering a property after it is built. Most of the off-plan options are apartments. In the first quarter, more than 10,000 properties were commissioned in Dubai, which is the leader in sales. By the end of the year, it is planned to commission at least additional 26,000 homes, almost 80% of which are apartments in new developments in Dubai.

Detailed overview of the UAE real estate market per emirate

Home sales statistics

Since the beginning of the year, over $ 2.9 billion in residential properties have been sold in Dubai. The rent increased and the return on investment index began to grow. The growth rates depend on the location, but the average increase is 4% to 10%. In the second half of the year, luxurious real estate has become more popular. Prices directly depend on the area of housing and its location.

The examples of luxury property prices in Dubai:

  • In Meydan One, one-bedroom apartments can be bought at the minimum price of $ 200,000.
  • In Dubai Healthcare, two-bedroom apartments can be purchased for $ 450,000.
  • A similar apartment in Al Barsha Site (Al Barsha South) costs a little cheaper. The price of an apartment starts from $ 370,000.

Trends to expect in the future

Experts offer different ideas. According to the results of the survey, some experts believe that the cost of real estate in the UAE will remain the same. However, most of the respondents expect that new investors will drive the prices up. Considering that most buyers associate the UAE with Dubai and Abu Dhabi, the reduction in construction caused by the lack of land in the central part of the cities may lead to an additional jump in prices.

It is always difficult to predict the potential of the housing market, as it depends on a large number of factors. The situation with the global pandemic has clearly proved that a crisis can happen unexpectedly and may not depend on the cost of oil. But most experts are inclined to believe that prices will increase before the end of 2021. This situation will continue in 2022, the growth in prices will also be affected by Expo 2020. Therefore, we recommend buying real estate in the UAE for investment or for moving to permanent residence right now.

Real estate in Dubai

This is one of the cities with traditionally high property sales. The interest in buying villas has almost doubled in this emirate. Although the sales have not reached the 2013 record figures, this is the first considerable growth since the price spike and subsequent fall. By the end of the first half of the year, the cost of sales reached a record and amounted to almost $ 17 billion. Considering that for the entire last year the amount of transactions in the megalopolis reached the level of 19.7 billion, the revival of purchasing activity is obvious. The most active investors are nationals of India, followed by expats from the UK and Pakistan.

Why property hunters choose this city in the UAE:

  • The cost of housing is still almost 36% lower than in the peak period of 2013.
  • It is more profitable to buy local property than similar options in major European cities.
  • Convenient payment scheme. Mortgages have become even more affordable. The down payment has been reduced from 25% to 20%, the interest rate for some properties is only 2%. This has doubled the mortgage sales.

Detailed overview of the UAE real estate market per emirate

Real estate market in Abu Dhabi

The capital of the country has been the second most popular destination after Dubai for a long time. This was largely caused by the fact that foreigners were not allowed to buy property there. In 2019 Abu Dhabi also introduced freehold zones where you can buy property and be its rightful owner. Investors choose Abu Dhabi for its high return on investment. It reaches 7-8% per annum. Local housing is in demand among both local residents and expats. About 80% of properties is purchased by local residents, so you can be sure that the housing has high liquidity.

The main trends in the region are:

  • Increased attention to luxury properties.
  • Demand for beachfront apartments. The coastline stretches along 700 km, which opens up great opportunities. It is believed that Abu Dhabi has the most comfortable white sand beaches with crystal clear water.
  • Transport accessibility. The capital has two largest airports in the country.

Apartments in Fujairah

Located in the eastern part of the country, the Emirate has a unique location. Although it does not have access to the Persian Gulf, it is washed by the waters of the Indian Ocean and the Arabian Sea. Holidaymakers choose this city thanks to its peace and quiet and a relatively small population. The emirate is home to around 150,000 people. The climate conditions are ideal, and the local coral reefs attract many divers. The average cost of housing in the emirate for a four-bedroom apartment can range from $ 817,000 to $ 998,000.

Houses and apartments in Ajman

This is the smallest emirate with access to the Persian Gulf coast. The resort area combines old quarters and areas with modern development projects. The property owners enjoy the calm atmosphere and close proximity to Sharjah. There are many attractions in this area, and the cost of housing is much higher. Ajman is famous for its pristine nature, clean beaches. It also offers a developed infrastructure. Everything you need for life is within walking distance.

The average property prices are as follows:

  • One-bedroom apartments can be bought at the price starting from $ 130,000. The cost depends on the living area.
  • Two-bedroom apartments are offered at the price starting from $ 160,000.
  • A five-bedroom villa can be purchased for $ 460,000.

Detailed overview of the UAE real estate market per emirate

Properties in Ras Al Khaimah

The emirate is famous for its perfectly clean beaches. The oil industry is not so developed in this emirate, therefore the environment is not affected by it. There are many hotels located on the front line. Holidaymakers can also enjoy many natural attractions, parks and zoos. You can learn the local mentality in the Bedouin camps, which accommodate tourists in tents in the desert.

In comparison with the largest cities in the country, the cost of housing in the emirate is more affordable:

  • A studio apartment can be purchased for as little as $ 130,000.
  • Two-bedroom apartments cost between $ 115,000 and $ 299,000.
  • A one-bedroom villa costs around $ 200,000.
  • A four-room villa costs from $ 1,500,000.

The prices are averaged and may vary depending on the living space and its type.

Home sales in Umm Al Quwain

This is another relatively small emirate of the United Arab Emirates. It has excellent climate conditions. In the winter months the temperature does not exceed 26 degrees Celsius, and in the summer the sea breeze helps to withstand the heat. The natural landscape combines mangroves, sand dunes and oases. There are also islands with a unique atmosphere and architecture. The emirate is full of attractions, ranging from a modern water park to an aero club. Sea activities inlcude sailing, fishing, surfing, visiting refined beaches.

Apartments in Sharjah

The emirate is located on the coast of the Persian Gulf. This is an area with developed infrastructure and a wide range of attractions: many museums, architectural monuments, shopping malls. It offers apartments for all tastes, from luxurious penthouses to compact studio apartments. The close proximity to Dubai ensures great opportunities. You can enjoy the vibrant city life in Dubai and escape from the hustle and bustle of the city in Sharjah. The housing market is quite democratic, you can buy:

  • A townhouse with four bedrooms for $ 453,000.
  • A two-bedroom apartment for $ 253,000 or a one-bedroom apartment for $ 153,000.

The emirate also has construction land plots for sale.

Important things to consider when choosing a property

Foreign nationals should be aware that there are two types of ownership rights to property: freehold and leasehold. A freehold property means that you are a rightful owner of the property, while a leasehold property means that you lease the property for a certain period of time (the lease term is usually 99 years). Even within the same district, there can be developments where foreigners are not allowed to buy property. However, the list of emirates and areas where foreign property hunters can buy housing is regularly expanding. You should clarify the form of ownership before you choose a property to buy. If there are no freehold properties in the desired region, you can always find the best options in the neighbouring communities.

Detailed overview of the UAE real estate market per emirate

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