Dubai’s Meydan and MBR City to see the most of the new housing supply

According to the latest update from Core, a real estate consultancy, the most significant part, namely 19 per cent of the 13,000 new homes to be handed over in Dubai, will be delivered in the Meydan area and surrounding projects in the broader territorial formation of MBR City, during the period from now and until the end of the year.

And as for the existing new supply, about 16,000 new real estate units were completed in Dubai during the first three quarters of the year, according to Core.

This is consistent with most forecasts given by other emirate’s housing market experts. According to them, the annual volume of new suupply will be about or slightly more than 30,000 units. At the same time, speaking of locations, Core believes that Business Bay will be in the third place in terms of newly delivered units number — about 15 per cent of all upcoming supply in Q4 is expected to be handed over here, while Dubai Silicon Oasis will have about 10 per cent of these.

So far, projects completed in Meydan and MBR City accounted for only 4% of all 16,000 new homes delivered from the beginning of the year and up to September. But there are still a row of new major projects in these areas, several of which are at an advanced stages and awaiting early completion.

Sales

Can the supply volume really put significant pressure on property prices? According to a Core report, exposure is location dependent. For example, it is interesting that the average prices in the apartment sales sector on the island of Palm Jumeirah, in Jumeirah Village and in Business Bay have decreased as new projects in these areas are in a higher price range.

Speaking of locations, the greatest pressure on sales prices over the last 12 months from newly delivered projects was experienced by property sellers in areas such as Jumeirah Village (13 per cent of average prices decrease), Dubailand (19 per cent), Discovery Gardens (15 per cent) and Dubai Sports City (15 per cent).

Rents

According to Core’s update, Dubai property rentals have decreased the most in areas such as Discovery Gardens (by 13 per cent) and Dubailand (12 per cent), since the bigger part of the projects in the middle price category were completed there.

On the other hand, in centrally located Business Bay, Dubai Marina and DIFC, there was a relatively moderate level of rental reduction recorded, according to Core.

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