According to a Reuters survey of property experts, Dubai home prices will increase for the first time in six years this year, boosted by a rapid vaccination rollout that has raised expectations for general economic revival.
Due to overstock and poor economic growth, the city’s real estate industry has been struggling for years.
However, Dubai lifted Covid-19 restrictions on Monday, allowing hotels in the hub to function at full capacity, restoring optimism to an area largely reliant on tourism.
How Much The Increase Will Be
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Analysts predict that prices will increase by 1.1 percent this year and 2.8 percent in 2022.
This year’s increase in Dubai home market activity is more probable, according to seven often real estate experts who replied to a follow-up question. The other three predict a slowdown.
“Because prices have been at the bottom for the past several years and inventory has been substantially restricted, we can already see increased investor confidence and a rise in demand,” said Anuj Puri from Anarock Real Estate experts.
“Here, too, the immunization campaign has gone successfully, and the economy has been steadily rebounding under government growth-stimulating measures.”
The Reuters poll of ten experts released on May 11-19 predicted that Dubai home prices would increase 1.1 percent this year and 2.8 percent the next year, reversing predictions from a January survey that indicated prices would fall 2.0 percent in both years.
According to eight out of ten property experts, the risks to those predictions were weighted more to the upside.
Buyers have been snapping up prime Dubai homes in recent months, taking advantage of cheap pricing, easy financing, and an economy that is open for business despite the Covid-19 epidemic.
Nonetheless, eight out of ten experts who answered another question indicated the greatest upside risks to housing sector activity this year are a dramatic reversal in the market or an increase in demand.
According to the Dubai Statistics Centre statistics, Dubai’s GDP is expected to expand by 4.0 percent this year after contracting by 6.2 percent last year.
According to statistics from the Dubai Land Department, the real estate industry, which accounts for approximately 8% of GDP, has lately seen an increase.
“Since H2 2020, the real estate market has been booming and continues to do so. The home market will be affected as additional government incentives to boost the economy become available, “Property Finder’s director of research and data, Lynnette Abad Sacchetto, said.
Five out of ten experts indicated an economic slowdown was the most significant adverse risk to home market activity this year. Others cited a lack of demand or scarcity of affordable housing.
“At this time, the only possible risk I see is if Covid-19 persists longer than anticipated, affecting economic development and tourism in the emirates,” said Simon Baker of Haus & Haus.