Rentals in the Dubai real estate sector are expected to maintain an upward trend in prices as the last quarter of the year rolls in, according to a report by Khaleej Times.
During Q3 this year, the sector saw prices go up by an estimated 14% in the affordable housing segment, and as much as 30% in the luxury housing segment in select areas.
With Expo 2020 kicked off, the Dubai real estate sector is expected to sustain this growth both in terms of rental prices and demand , the report said, citing data from Zoom Property Insights.
Other reasons for the surge include growing demand for larger spaces, increased interest from foreign investors, expat-friendly policies such as visa schemes, and a change in business ownership to 100% foreign ownership.
Elsewhere, sales are also expected to see a marked increase in Q4, the report suggested. A total of 15,926 deals for a total deal volume of AED 42.35 billion were recorded in Q3, historically the best quarter by transaction value for the Dubai real estate sector.
The second quarter of the year also saw highlights for the Dubai real estate sector in terms of sales. Sales volumes for Q2 broke records for every other quarter since 2010, according to another report. Meanwhile, the transacted price per square foot for the quarter also crossed the AED 1000 mark for the first time in three years.
DUBAI REAL ESTATE SECTOR RECOVERY WILL BE SEGMENTED
During Q3, areas including Jumeirah Village Circle (JVC), Al Nahda, Bur Dubai, Dubai Silicon Oasis and Deira saw increased activity for affordable apartments. Meanwhile, Dubai Marina, Downtown Dubai, Jumeirah Beach Residence (JBR), Palm Jumeirah, and City Walk were popular locations for the luxury apartments segment.
Key areas for affordable rental villas included Mirdif, Damac Hills 2, JVC, Reem and Dubai South. Luxury villas were more popular in Jumeirah, Al Barsha, Umm Suqeim, Arabian Ranches and Dubai Hills Estate.
These areas are likely to continue in popularity during Q4 as well, the Zoom Property Insights suggested.
Meanwhile, the Khaleej Times report cited Edward Macura, partner at real estate consultancy Core, as saying that rental recovery will be segmented.
“Villa districts and most of the prime apartment locations are expected to see a faster pace of recovery while most affordable and outer apartment districts with ample existing stock are expected to see slower stabilisation rates,” Macura said.
Macura also added that most rental increases in the Dubai real estate sector were from the new-let market.