Since its inception in 2020, the COVID-19 pandemic has become a serious test of strength for all countries. Yet, despite the lockdown, Dubai has demonstrated sustainable growth in the real estate sector. In addition, it has managed to maintain the top sales position in both the primary and secondary housing markets. However, this wasn’t without sacrifice or consequences. To read more about this, including how the pandemic has affected one of the world's most technologically advanced cities and what to expect next, continue reading below.
- Impact of the COVID pandemic on property sales in Dubai
- How will the real estate market change after COVID-19 in Dubai
- What will happen next in the Arab real estate market?
- Additional development projections
- We will assist you to find the best real estate deals in Dubai
Impact of the COVID pandemic on property sales in Dubai
In the first half of 2020, the Dubai real estate market experienced its most devastating slump in the form of COVID-19. International traffic was canceled. As such, transactions for the purchase and sale of housing were frozen. There was a decline. Any likelihood for further development was very vague and uncertain. However, the wait didn’t last long.
The government started stimulating the economy and the housing market with operational measures. Gradually, sales began to recover and gain strength. A significant part of the total number of transactions was concluded online. Modern technologies have made it easier to find, choose and purchase a house, while at the same time, it’s also made it easier for people to visit the country.
According to the analysis of the Dubai housing market, the Dubai Marina district became the leader in housing sales during the pandemic. The square meter of housing here fell by 2%, from 1277 AED in the second half of 2019 to 1252 AED in the first half of 2020. So due to the price reduction from 694 thousand AED down to 648 thousand AED, one-bedroom apartments have become very popular.
Following this then, the district of Downtown Dubai took 3rd place in the ranking of the most popular housing during the pandemic. However, here experts noted an increase in the average price per square meter of apartments from 1808 AED to 1830 AED. Previously, it was possible to purchase one-bedroom apartments here for 901 thousand AED.
On the other hand, a slight increase in prices was found in the Palm Jumeirah district, with prices from 1369 AED to 1358 AED.
Other than this, investors' attention was also focused on residential and centrally located areas such as Jumeirah Village Circle, Jumeirah Lake Towers, Jumeirah Beach Residence, and Dubai Silicon Oasis. Here, the price decline was quite obvious, especially as the drop in the cost per square meter was almost 6%.
How will the real estate market change after COVID-19 in Dubai
Analysts who study the housing market in Dubai believe that in the coming years, the trend for purchasing housing in green areas of the city near parks, squares, gardens, playgrounds, and other areas will have a positive impact on the integration of residents into the community.
It is clear that the COVID pandemic has significantly affected buyers' requests with regards to their choice of housing location, as well as, its size and the overall conditions for a comfortable life. This is mainly because most people could not organize their work environment at home during the period of self-isolation. Particularly, since there was a need to expand both the working space and the life of family members too. As a result, the increased demand for spacious housing has also heightened the interest in private houses and villas with public services.
What will happen next in the Arab real estate market?
With a high probability of increased demands for housing (especially due to the situation with the COVID pandemic), the further development of the real estate market in Dubai and the UAE will specifically be aimed at creating more comfortable housing facilities. This will extend to affordable living conditions for large families, along with considering the needs of customers in this space as well.
Moreover, with regards to the coronavirus pandemic, 5 main categories have been created, which will undoubtedly affect the development of the real estate market for the foreseeable future in the UAE:
- Increasing demand for spacious real estate, with separate offices and rooms for study and work.
- Increasing demand for townhouses and villas.
- Reduced demand for purchasing and renting housing with small living spaces and small windows, especially without the option for a balcony.
- Increasing demand for housing in residential complexes with all the most favorable conditions for living and relaxing.
- Transformation of residential complexes into places with comfortable conditions for spending time with the whole family.
In general, the predictions for 2021 are more than optimistic. Prices for the rental and purchase of real estate are expected to decrease. Furthermore, while price dynamics will largely depend on the type of property and its location, the demand for apartments and houses will continue in developed areas of Dubai.
Additional development projections
Currently, the UAE government is doing everything possible to stimulate and retain the interest of investors. The tourism sector, in particular, has capital investments that also contribute to the housing market.
The events that happened during the first half of 2020 are a thing of the past. Especially, since huge growth occurred in the second half of 2020, along with continued success right up into January and March 2021. Right now, real estate in Dubai is showing every indication that it’s keeping its place as the best-selling housing country on the international scene. And it doesn’t look like it will be backing down any time soon!
We will assist you to find the best real estate deals in Dubai
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