What Market Studies Are Showing?
Ten thousand or 66% of all August purchases were off-plan properties, according to Emirates NBD Research. Although over the past few years the general demand and market attitude across the city has improved, the off-plan sector has witnessed the largest increase in transaction volumes. If we look at the property market, more than 69,101 off-plan units have already sold in the year to August 2024 whereas 17,600 off-plan units were sold overall across Dubai in 2018. Emirates NBD predicts over 100,000 off-plan transactions for the whole year at current transaction situations, which is a 468% increase in transaction activity over 2018.
Some professionals think that ready properties accounted for 54% of all purchases in the first quarter of 2024, compared to 46% for off-plan, therefore drastically changing investor priorities for increasing the market for ready-made homes.
Some brokers are also saying that, "buyers are looking more and more for quick returns through rental income or occupancy instead of waiting for construction to be finished." Reflecting the growing demand for ready homes, existing properties also experienced a 30 percent increase in transaction volume in Q1 2024 over the same time in 2023. With a little 5% rise in transaction value, the off-plan market stayed steady, suggesting that although it is still very good, several investors looking for faster returns now pay more attention elsewhere.
The huge number of 2023 launch timetables was another thing somewhat lowering off-plan prices. Pricing policies are being changed to stay in the market given increased developer competition. Some brokers in Dubai also noted that investors are growing increasingly risk-averse and choosing the security of ready-to-move-in residences over the unknowns associated with off-plan projects including market changes or building delays.
This stability of the market is a good thing. Following the unheard-of price increase last year, a time of consolidation and more moderate development is both expected and good. Although the huge demand in 2023 raised prices, the market is currently starting a flat situation between supply and demand. While still providing chances for developers and investors, this move towards ready residences helps to normalise off-plan prices.
