Villa capital values in Dubai increased by 31 percent in October

Overall sales activity has slowed down, however, demand for ready units is still strong.

In October, residential property prices in Dubai continued to strengthen, with some villa communities posting capital gains of as much as 31 percent if compared to last year, real estate consultancy ValuStrat indicates in its latest report.

However, sales activity has slowed down, especially in the off-plan market. Overall transaction volumes dropped by 4.3 percent in October compared to September. And some properties outside the city center are still unable to recover from the capital losses of last year.

The ValuStrat Price Index (VPI) for Dubai jumped 12.6 percent during the month compared to the same period in 2020, while monthly gains accelerated from just 0.7 percent in January to 1.8 percent in the latest review.

Villa capital values have grown dramatically in popular neighbourhoods such as Arabian Ranches, which posted capital gains of 31 percent, Jumeirah Islands (30.9 percent), The Lakes (27.9 percent) and The Meadows (26.7 percent).

In the apartment segment the top annual performers are properties in established beachfront communities in Palm Jumeirah, up by 14.6 percent, and Jumeirah Beach Residence, up by 12.1 percent.

Areas showing negative annual performance include apartments in Jumeirah Village, where capital values fell by 6.3 percent, Dubai Sports Сity, down by 2.8 percent, and Dubai Production City, down by 2.6 percent.

Although total transaction volumes have dropped, demand for ready units is still strong, and sales rose by 6.6 percent month-on-month. Off-plan property deals, accounting for 42.6 percent of overall transactions, delicensed by 15.8 percent.

In addition to that, Dubai’s property market continued to attract high-net-worth individuals. At least 19 properties worth over USD 8.1 million were snapped up in October alone. These units are concentrated in the following areas: Dubai Hills Estate, Downtown Dubai, Business Bay, District One, Jumeirah Golf Estates, Emirates Hills and Palm Jumeirah.