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Real estate related transactions in Dubai totalled Dh113 billion for the first half of this year compared with Dh129 billion a year ago.
Business Bay was the most heavily transacted location, accounting for 1,643 units and with a combined value of Dh2.34 billion, figures released by Dubai Land Department show.
Dubai Marina followed in second spot with 1,392 transactions (combined value of Dh2.89 billion) and Warsan 1 was in at third with 999 transactions (value of Dh454 million).
In all, there were 28,251 deals struck in Dubai real estate during the first six months, split into sales, mortgages and other transactions. Sales made up the bulk of the deals with a 43 per cent share and Dh48.71 billion in value.
Sale of properties alone were valued at Dh24 billion.
“Dubai has achieved a high percentage of growth, with the value and number of transactions, which provides reassurance about the positive development the market is witnessing,” said Sultan Butti Bin Merjen, Director-General of Dubai Land Department.
According to market sources, the final first-half tally is higher than what many had thought was possible at the start of the year. At the time, the market was still in the depths of a major downturn, with both prices and property values sliding.
But from the second quarter onwards, the rate of decline in property values started to slow down and then stabilise, while there were also increases in sales volumes. It was at the time many of Dubai’s developers made a determined bid to jack up sales through sales incentives, which include deferred post-handover payments, low monthly instalments and better support through mortgage providers.
Market analysts remain hopeful that for the full year, the total will be closer to the Dh267 billion attained in 2015. These expectations are based on a number of projects nearing completion, and which is always a good time for a sales boost. Also, by September, the off-plan market should start getting active again, with locations such as Dubai South, MBR (Mohammad Bin Rashid) City and Culture Village expected to be the beneficiaries.
In its new Dubai market overview, JLL reckons that a full-scale recovery is likely to start from next year. Others suggest there could be a pickup in sentiments where Dubai and its realty are seen as a safe haven in uncertain times. But much will rest on whether the dollar retains its strength or even get stronger, which can then be an impediment to overseas buying activity in Dubai.
“If London’s property market suddenly looks less interesting for the global wealthy, there is a chance they might be attracted to new choices in Dubai,” said an estate agent. “Some super-premium projects are getting close to completion, while more off-plan launches are likely in the second-half. If developers market it right, they can tap a lot of interest.
“It has happened before in 2011-12, when the Arab Spring unlocked a lot of regional investor fund flow into Dubai. It could happen now given the uncertainty over the global economy.”
Meanwhile, in the first-half, sales of buildings and property units totalled 20,699 deals for a Dh28 billion price tag. That of land alone fetched Dh27 billion from 4,753 transactions. Mortgage-based land deals accounted for Dh42.75 billion (from 2,377 transactions). Other transactions gained Dh14.39 billion from 422 transactions. In all, land-based transactions achieved Dh84 billion.
The Seeh Shuaib 1 area was the most attractive for investors, with the value of transactions from plot sales at Dh2.36 billion through 1,227 deals. This was followed by Shaikh Mohammad Bin Rashed Gardens with 406 transactions worth Dh1.97 billion and Al Yafra 3 with 387 transactions at Dh622 million.
Source: Manoj Nair, Associate Editor, gulfnews.com