The new year of 2024 has started so have the launches of several new projects accommodating new luxuries in the posh location of Dubai. If you are looking for a house in Dubai then, it is time to dive into the sizzling Dubai property market. Recently, it has been all very good, but hold on a bit – a cooldown might be on the cards. Word on the market is that a slowdown is looming.
Holding Properties
Now, let’s take an example of couples from other countries like Egypt. An informed couple, hailing from Egypt, have only been property owners in Dubai for a mere nine months. But hold on, they are not just sitting back and relaxing. They are already plotting their next move in the vibrant city. What a cool choice!
Here’s the thing to see: After eight years of renting in Dubai, this informed couple made a clever decision. They are saying goodbye to their two-bedroom pad in Jumeirah Village Circle , right on Dubai’s outskirts. They are aiming to sell it for a jaw-dropping 26% more than their initial investment of 1.7 million dirhams ($460,000) made just this March.
Eyeing for bigger Properties
Some buyers are also eyeing the prize – a bigger abode for their family of three, hoping to snag it at the same or a better price. A family has been helping pay off someone else’s mortgage for too long, scared of a fluctuating market, explained the 39-year-old person who is studying the property market of Dubai. ” They think the market’s hit its peak, so they are aiming to sell and buy a home with a garden next year, so they are also hoping for a price drop.
Hundreds and thousands of buyers are riding the wave of Dubai’s blistering property market, one of the global leaders this year. From tenants to brokers and developers, everyone’s playing the guessing game – is the market about to shift gears as new properties flood in and global economic uncertainties loom? But the answers are not that easy but the current situation of the first week of January 2024 is looking very good.
Reason for the current increase in property prices
The current boom owes much to an influx of rich investors – think Russians safeguarding assets, crypto buzzes, and wealthy Indians hunting for second homes. Dubai’s old pandemic strategies and flexible visa rules have also drawn in more overseas buyers.
Since January 2020, Dubai’s rents have shot up about 42%, while home prices leaped by 33%, according to a real estate company. Villas, especially, are in high demand, now renting for an average of $88,400 annually.
This surge has nudged some buyers to jump into homeownership, dodging spiraling rents and the push outwards from the city’s heart. Picture this example: Suppose a person’s landlord upped her rent by 16% over three years. But he/she did not just stand by – the person bought the very flat he/she was living in rent and now that person is set to sell it. That is seizing your financial future with a good choice!
Dubai’s real estate scene has been akin to a wild financial adventure – think intense highs and lows. The 2009 crash, a result of debt-driven expansion, nearly toppled some big-name developers. There was a brief price recovery in 2011, but then 2014’s oil price crash sent the market spiraling. To counter this, the government stepped in with reforms, like hiking mortgage down payments to 20%.
Suggestions of Professionals
But a professional from a real estate company cautions that selling now, hoping to buy cheaper next year, is a gamble. The professional predicts price increases will slow to 5-10% next year, but isn’t convinced prices will drop given the rising population and economic growth.
Currently, there’s good proof of a market slowdown in the city. But experts are eyeing 2024 as a possible turning point. Another property professional, for one, anticipates a cooler market next year compared to 2023.
Rents are still sky-high, but the hike is slowing in some trendy neighborhoods. A company noted a slight dip in rent growth in November. However, property transactions dipped 13% that month, mostly due to a drop in off-plan sales.
Prediction of Property Consultants
A team member of Dubai Housing also sees prices cooling, not plummeting, next year. Population growth and possible rate cuts could encourage more mortgage buyers, that team member says.
Dubai Housing last month projected a 5-7% rise in home prices next year, followed by a 5-10% decline over the next 12-18 months as global uncertainties and new home supply affect the market. Other brokers and companies in the property market observed a downsizing trend among buyers, hinting at a ceiling in purchasing power.
Builders views
Builders, after a banner sale last year, are rethinking. Dubai Housing expects a whopping 40,000 properties to hit the Dubai market next year and the same in 2025 – a significant uptick from prior years.
Mohamed Alabbar of Emaar Properties, the brains behind the world’s tallest skyscraper, is playing it smart despite the booming market. Emaar Development has seen a 60% revenue backlog surge in home sales. Alabbar is keeping a close eye on project execution and contractor balance sheets, remaining vigilant despite the economic highs.
Not only this, but Hussain Sajwani, the gifted person behind Damac Properties , a prominent privately-owned developer in Dubai, holds the conviction that the real estate market in Dubai is not currently experiencing excessive heat. He foresees a forthcoming stabilization of price escalations. This billionaire is having a tough time trying to foresee what’s coming down the road next year.
Conclusion
Dubai is a soaring property market for now, but the situation may change, so it is important to wait for the current time to invest in luxurious properties in Dubai. For more chances of good returns, it is better to buy a new property in a good location in Dubai.