Dubai price recovery to lag in 2019: Core

Thousands of handovers in the affordable and mid-market segment to outpace demand

Dubai during a sandstorm. Alex_Ugalek/Shutterstock

Over 28,500 residential units are set for delivery in Dubai by the end of 2019, with most homes falling under the affordable to mid-market segment and located in the emirate’s outer areas, consultancy Core reported via Khaleej Times.

Although the pace of price softening has relatively slowed, Core expects a lag in sales and rental price recovery as existing, unoccupied stock, along with future supply over the next couple of years, is expected to outpace steady demand, said Edward Macura, partner at Core.

“That said, the market is highly occupier-friendly due to the wide variety of options now available at very competitive prices with higher levels of flexibility offered by both developers in new launches and landlords in the rental market.”

Around 81 percent of the handovers will be apartments, while 19 percent will comprise villas. Units located in Dubailand and Jumeirah Village Circle and Triangle are to comprise a third of all deliveries.

Off-plan transaction volumes slumped by 30 percent in the year to 2018, partly due to fewer off-plan launches last year compared to the previous year.

“Secondly, developers prefer to sell inventories closer to the actual date of delivery to gain higher traction from both investors and end-users alike,” Macura explained.

Secondary market sales, both composed of cash and mortgage sales, saw a 9 percent spike last year though, reflecting an end-user market.