Villas lead Q2 value surge for Dubai realty

Dubai - The quarterly ValuStrat Price Index for apartments grew 1.7 per cent, but declined 4.8 per cent when compared to last year. Jumeirah Beach Residence, Palm Jumeirah, Downtown Dubai, and The Views where the best quarterly performers.

Villas spearheaded a the surge in Dubai’s residential property value in the second quarter with a rise of 7.0 per cent when compared to the previous quarter and an annual gain of 6.3 per cent.

The ValuStrat Price Index for residential capital values grow 3.8 per cent in the second quarter of 2021 when compared to the previous quarter, as a result which most areas recovered their capital losses of last year, the latest Dubai Real Estate Market Report said.

All villas monitored by the basket saw improvements not seen since 2014. The highest annual capital gains were recorded in Arabian Ranches at 10.3 per cent, Jumeirah Islands with 9.1 per cent, Dubai Hills Estate at 9.0 per cent, The Lakes with 8.2 per cent, Mudon at 7.7 per cent and, The Meadows with 7.2 per cent.

The sharp increase in value reflects Dubai’s real estate sector’s increasing pace of performance, reflecting the vitality, flexibility and attractiveness as the sector recorded 6,388 sales transactions worth Dh14.79 in June 2021, which is the highest in value in eight years, specifically since December 2013, according to Dubai Land Department data.

The sales transactions in June 2021 are 44.33 per cent higher in terms of volume and 33.2 per cent in value compared to May 2021.

The quarterly ValuStrat Price Index for apartments grew 1.7 per cent, but declined 4.8 per cent when compared to last year. Jumeirah Beach Residence, Palm Jumeirah, Downtown Dubai, and The Views where the best quarterly performers.

The Dubai VPI for residential rental values stood at 60.8 points, up 6.5 per cent quarterly, writing off all losses from last year. On a quarterly basis villa rents were up 9.5 per cent, and apartment rents rose 4.6 per cent. Dubai’s citywide residential net yields averaged 4.8 per cent, said the report.

Total estimated completions as of the second quarter stood at 11,329 apartments and 2,320 villas, equivalent to 28.6 per cent of preliminary estimates for this year.

Notable apartment completions were Amna Tower Al Habtoor City (450 units), Bellevue Towers (360 units), UNA Apartments (956 units), Bloom Towers JVC (946 units). For villas, Albizia, Janusia, Aster and Sycamore in Akoya Oxygen (1,644 units), Villanova Amaranta 2 (352 units) and Jumeirah Luxury in Jumeirah Golf Estates (290 units).

Approximately 26,318 apartments are under construction with majority located in Mohammed Bin Rashid (MBR) City (16 per cent), Downtown Dubai (15 per cent) and Dubailand (12 per cent). More than 80 per cent of the 7,811 new build villas will be in Dubailand and MBR City.

Key off-plan projects announced during Q2 included Sobha Waves at The Waterfront District (592 units), Palace Beach Residence Emaar Beachfront (541 units), Murooj Al Furjan (418 units) and Bliss Townhouses (335 units) at Arabian Ranches 3.

Sales volumes of residential units in the second quarter broke the previous quarter record, and every other quarter since 2010, said the report. Annually, non-mortgage sales volumes of ready homes grew 395.6 per cent, compared to 196.3 per cent off-plan sales, this not surprising given that the city last year was on lockdown due the Covid-19 pandemic.

When compared to the previous quarter, ready home sales were up 22.3 per cent and off-plan sales jumped 56.3 per cent.

Ready homes ticket sizes grew 11.9 per cent QoQ, and off-plan homes leaped 12.4 per cent quarterly to Dh2.4 million and 1.5 million, respectively. The citywide average transacted price per square foot has crossed the Dh1,000 for the first time in three years

Overall citywide residential asking rents remained stable when compared to last year, however, spikes in asking rentals were observed due to increased villa demand.

On a quarterly basis, residential asking rents were up 6.5 per cent, the first substantial gain since 2014.

Compared to the same period last year, listed rents were down 7.8 per cent for apartments but jumped 15.2 per cent for villas, the highest record increase since our base year.

Average annual rents for 2-bed villas stood at Dh105,000, 3-bed units at Dh151,000, and 4-bedroom villas at Dh 215,000. Average rents per annum for studio apartments were Dh34,000, 1-bed at Dh51,000, 2-beds at Dh74,000, and 3-bedroom apartments were Dh113,000. Residential occupancy in Dubai was estimated at 83 per cent this quarter. — issacjohn@khaleejtimes.com