Cash Buyers Are Snapping Up Dubai Properties As Prices Plummet
Cash buyers are snapping up Dubai properties as prices plummet
Cash sales transactions for whole month of June up 26% as restrictions ease.
Sales of villas and apartments in Dubai have increased following the easing of COVID-19 related lockdowns, and if you are a cash buyer, now might be the time to invest in real estate.
In a report published this Monday, consultancy firm ValuStrat said that cash sales transactions for the whole month of June were up by 26 percent compared to May, indicating a huge amount of pent-up demand among investors.
Plummeting real-estate prices were also a major driving factor, with buyers snapping up completed units at beaten-down prices rather than off-plan properties. ValuStrat’s latest index showed that real estate capital values in Dubai continued to soften, with prices hitting their lowest level in a decade in May, down by 1.9 percent compared to April and 12.5 percent from a year ago.
As of June, buyers could easily find a home for sale at less than 2 million UAE dirhams, with the weighted average capital value for the month pegged at just a little over 1.6 million dirhams. The average price per square foot has also dropped to just 881 dirhams.
“With the stay-at-home measures relaxed, and prices per square foot reaching 10-year lows, June’s cash sales transaction volume performance leaped [compared to the previous month],” ValuStrat said in a report.
Popular developments
Many of the buyers were drawn to properties developed by Emaar, Damac, Danube and MAG, which topped the sales charts overall.
In terms of location, the most popular ones were properties in Jumeirah Village, Downtown Dubai, District One and International City. For ready homes, the most transacted units were Dubai Residence Complex, Business Bay, Dubai Marina, Town Square and Dubai Sports City.
According to Haider Tuaima, head of real estate research at ValuStrat, fewer sales were recorded in June for off-plan properties, despite the lifting of restrictions.
“Off-plan sales faced a continued downward trend due to minimal new project launches,” Tuaima told Zawya earlier.
The UAE government started easing its restrictions in late May, allowing business owners to reopen gradually with strict rules on social distancing and wearing of face masks.
According to the Dubai Land Department (DLD), buying activity was already inching up in May, with the emirate’s sales house index increasing by 0.5 percent during the period compared to April.
For apartments, the index for May went up by 1.189 percent, the highest since April 2019, and for villas and townhouses, the index was up 1.060 percent, a new level since November 2019.
The DLD also recorded a total of 1,440 sales transactions worth 2.47 billion UAE dirhams in the same period, bringing the total to 13,590 sales transactions in the first five months of 2020 worth 27.8 billion dirhams.
“These figures… reflect the attractiveness of the Dubai real estate market, even during these exceptional circumstances,” said Latifa Ibrahim Ahmed, director of the Real Estate Studies & Research Department at DLD.
(Source: Cleofe Maceda; editing by Seban Scaria. Zuwya)
