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The fact that villas in different Dubai residential communities are still getting slightly pricier, in contrast to the rest of the real estate market, indicates the unquenchable demand for a cozy house with a garden on behalf of potential buyers. Even if this house costs billions of UAE dirhams.
The more so, since the number of villas delivered in Dubai annually is getting smaller: “A skewed apartment-to-villa ratio is emerging, with 2017 supply estimated at 90:10 – a sharp contrast to a 75:25 ratio of 2016,” the report by Core Savills revealed. This “should cast steady upward pressure on sales prices for well-maintained existing prime units in the mid-term,” the report adds.
Experts acknowledge impassively, tenants complain about, while investors and landlords celebrate the fact that Dubai real estate market is still predominantly a high-end property market. This is evidenced by a high demand, both in rental and sales categories, for properties in the most luxurious central areas of Dubai Marina, Jumeirah and Downtown, as well as by real estate prices in these locations staying stable for several consecutive quarters.
Moreover, Cluttons consultancy notes that even in the middle-price segment of such areas as Motor City, Emirates Living and Jumeirah Park shows though barely noticeable (around 0.1%), but evident growth in housing prices.
Despite the affordable housing sector expansion due to such areas development like, for example, International City, which by now is already having over 22,000 affordable housing units, or like other locations of that along Emirates Road, Dubai is consistently among the top 10 most expensive cities globally. As long as tenants can afford it, they will try to settle closer to the center of Dubai, because, otherwise “the distance to work, an evening out or at the beach becomes that little bit further and the ‘attractiveness’ of living in Dubai is somewhat compromised,” analysts summarize.
Thus, the conclusion that can be driven from different experts opinions is quite ambiguous: on the one hand, Dubai lacks affordable housing, especially with the upcoming Expo 2020, which will require thousands of new affordable accommodation options for the Expo employees; but on the other hand, the situation is favorable for investors and homeowners, whose property retains its capital value with capital and rental yields growing along.
