Dubai property market expected to pick up in H2 – Land Department chief

The Dubai market is expected to pick up grow in the second half of 2020, the director general of Dubai Land Department has said.

Sultan Butti bin Mejren, director general of DLD, said: “We expect the market to grow in H2 2020 following the outbreak of the pandemic and for preparations made by the emirate for various activities to return to normal, making certain to apply precautionary measures that would depend on the public’s awareness.”

The Dubai overall sale price index rose by 0.79 per cent in Q2 2020. Similarly, the Dubai apartment index rose by 0.58 per cent, while the Dubai villa/townhouse index remained unchanged in Q2 2020, the fourth edition of Mo’asher, Dubai’s official sales price index, launched by Dubai Land Department (DLD) in cooperation with Property Finder, revealed.

“According to the same report, Mo’asher constitutes an important step that helps Dubai achieve further progress in this aspect, given the adoption of a single index that can be widely used by all market participants,” bin Mejren added.

“On the other hand, Dubai’s movement up the ranks in JLL’s Global Real Estate Transparency Index 2020 from 40th to 36th is expected to contribute to an increase in foreign direct investment and enhanced sector transparency. Dubai continues to make progress in its surroundings, while continuing to improve the availability of market data to reach the highest ranks and enter global competitiveness in the field of real estate transparency,” he added.

In June 2020, real estate sales transactions in Dubai grew by 64 per cent compared to May, with an average of around 570 properties sold in Dubai every seven days, the report revealed.

The base year for Mo’asher is 2012 and the base month for the monthly index is January 2012, with the base quarter for the quarterly index being Q1 2012.

In Q2 2020, Mo’asher showed a 0.79 per cent rise compared to Q1 2020 and 15.3 per cent compared to the base year Q1 2012.

The monthly index scored 1.113 in June 2020 compared to 1.121 in May 2020, with an index value of Dhs1.06m.

In June 2020, the monthly apartment index recorded 1.179 and an index value of Dhs1.018m, while the monthly villas/townhouses index recorded 1.040 and an index value of Dhs1.628m, marking a decrease of 1.79 per cent since the beginning of the year and a decrease of 1.89 per cent month-on-month.

Majida Ali Rashid, CEO of the Real Estate Promotion and Investment Management Sector at DLD, said: “JLL’s Global Real Estate Transparency Index 2020 highlighted the prestigious position held by Dubai, ranking first in the MENA region as the most transparent real estate market. This had a significant impact on the growth of the volume of foreign direct investment as the real estate sector acquired a large share of it, which prompts us to coordinate with all concerned parties to meet the aspirations of real estate investors in accordance with the best international standards and practices to preserve Dubai’s image and its internationally prestigious reputation. On the other hand, we have taken note of the diversification of offers to suit different segments and the provision of flexible payment plans to attract the most likely buyers. Moreover, we continue to coordinate with the Higher Committee for Real Estate Planning to understand the market situation and the needs and expectations of the various parties.”

Dubai recorded 5,605 real estate sales transactions in Q2 2020 worth Dhs11.05bn, while the  secondary market saw 40 per cent of the transactions in Q2, while off-plan accounted for 60 per cent of the transactions.

In June, the volume of sales transactions was 2,361 worth Dhs4.9bn and the secondary market, for the first time since the lockdown began, had higher sales transactions than off-plan transactions at the end of Q2.