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The residential market is leading the growth of the real estate sector in Dubai. It recorded its strongest performance after rebounding sharply from the global financial meltdown since early 2013.
Values are rising in many prime locations, keeping the momentum upwards. Investors from across the globe have been investing in Dubai's growing residential property sector, aiming at making great returns in terms of value. Home buyers have a wider variety of options now, and the luxury property segment is well-appreciated. However, affordable and mainstream residential properties have gained popularity and their values have surged in several locations. The increase of property values in popular and well-established locations is even higher.
The residential property market in the emirate has been boosted by a number of factors, mainly the city's status as a safe haven, improved consumer and investor confidence, strong regulations, transparency and the availability of funding. The safe haven status has strongly helped the market to benefit from catering to the demand of investors from several countries within the region. This is mainly attributed to the forward-thinking measures implemented by the government to safeguard the market.
A strong domestic demand has also helped boost the average values of residential properties. With the easy availability of mortgage for off-plan projects, more residents are shifting from renting to owning their residences, gradually turning the market into a buyer's market.
The overall market fundamentals in the real estate sector are currently stronger compared to the previous years, with solid demand from occupiers, increased developmental activities, healthy global economy and stronger local regulations. Aside from the location factor, home buyers generally invest in properties only if there is good appreciation for property, credibility and delivery on time. Growth rate is a major factor in assessing market sustainability and property value.
The Dubai market is sturdier and capable of delivering a further rise in property prices. The robust performance of the economy, with strong growth in other key sectors like retail, trade, tourism, manufacturing and industry, also contributes to the trend.
• Easy financing for off-plan projects has turned tenants into homeowners
• Increasing property prices are felt in almost all residential property segments
• Well-established locations witness even higher increase in property values
Get a glimpse on institutional investment in Dubai
Source: Yash Shah, Special to Properties
The writer is Property Sales & Leasing Manager, SPF Realty