Bayut Real Estate Bytes: Forecast for the Dubai real estate market in 2020
After the first month of 2020 has come to a close, homeowners, buyers and tenants are curious to know, ‘What is the forecast for the Dubai real estate market in 2020?’ With the much-anticipated Expo 2020 approaching soon, there is a lot of conversation around how property prices will evolve, which areas are prime for Dubai property investments in 2020 and the potential of the emerging holiday home market. The latest episode of Bayut Real Estate Bytes presents a detailed Dubai real estate forecast for 2020, with expert advice and opinions from industry leaders. Keep reading to learn more about the Dubai property market outlook for 2020.
Joining Dr Mahmoud El Burai on the show in this episode is our CEO, Haider Ali Khan! Mohanad AlWadiya, CEO of Harbor Real Estate and also known as the ‘Wolf of Real Estate’, is also a special guest on this episode.
BAYUT REAL ESTATE BYTES DISCUSSES DUBAI REAL ESTATE OUTLOOK FOR 2020
Bayut Real Estate Bytes is a unique property show hosted by Dr Mahmoud El Burai, Vice President of the International Real Estate Federation. This is a special segment where our users can seek the opinion and advice of real estate industry experts, visionary leaders and government officials who feature as guests on the show. This episode of Bayut Real Estate Bytes presents the Dubai property market forecast for 2020 with expert opinions from Haider Ali Khan and Mohanad AlWadiya.
Together, they answer some of the most pertinent questions that stakeholders in the Dubai real estate industry are asking, and provide a comprehensive outlook on the Dubai property market in 2020.
Keep reading to find out the highlights from the video and the forecast for the property market in Dubai in 2020!
HOW CAN WE EXPECT PROPERTY TRENDS TO EVOLVE IN 2020?
2019 had been an interesting year for the Dubai real estate market, which saw an increase in real estate transactions, worth a staggering AED 81.03B, as per data from the Dubai Land Department. This positive, upward momentum is expected to carry forward into the Dubai real estate market in 2020, creating many exciting opportunities for buyers and investors.
With the Expo 2020 around the corner, real estate prices in Dubai in 2020 are also likely to increase, although, this will strongly depend on the location of the property. More visitors will experience Dubai and the UAE, while the Expo 2020 projects will further improve infrastructure, increasing demand for Dubai real estate in 2020. Dubai’s average price-per-square-foot is also much lower than other metropolitan cities such as New York, Hong Kong and Geneva.
This ‘affordable luxury’ aspect will also create an appetite for properties in Dubai and likely drive prices up in the long-run. Combined with this, the approved increase on the fiscal budget of AED 66.4B for Dubai in 2020, will bode well for all economic sectors.
Another factor to consider for the Dubai property market outlook for 2020 includes proactive initiatives by the government, such as the formation of the Higher Committee for Real Estate Planning. With such real estate laws in Dubai being introduced, the number of project launches by developers also will be monitored better, paving the way for a more sustainable property market. The increased regulation and long-term outlook will also encourage more institutional interest in the Dubai real estate sector in 2020, with a greater number of real estate investment trusts (REITs) and crowdfunding firms entering the market.
Mohanad AlWadiya also forecasts that Dubai will see more affordable projects being developed in 2020. He notes that developers have already caught onto the trend, and are working to cater to this burgeoning market.
IS IT BETTER TO BUY OR SELL PROPERTY IN DUBAI NOW?
Mohanad AlWadiya believes that Dubai is a buyer’s market right now, with many lucrative opportunities. The competitive nature of the market means that developers are being creative when it comes to attracting buyers, both in the primary and secondary market. The Dubai housing market outlook indicates that buyers can not only expect attractive property prices, but also take advantage of post-handover payment plans, and excellent finance rates from banks, too.
WHICH ARE THE BEST AREAS TO BUY PROPERTY IN DUBAI IN 2020? SHOULD YOU BUY OFF-PLAN OR READY PROPERTIES?
According to Haider Ali Khan, the best places to buy property in Dubai in 2020 will largely depend on the objective. Traditional areas such as Dubai Marina, Downtown Dubai and Arabian Ranches, will continue to generate interest in 2020 from buyers looking to purchase ready properties for personal use. Developments along Al Qudra Road like Reem and Mudon will also draw interest from end-users due to well-developed facilities. Whereas, suburban, off-plan developments such as Dubai Hills and Dubailand will attract buyers looking for good return-on-investment. The lower price-per-square-foot combined with developing infrastructure in the surrounding areas will likely result in capital appreciation. Those who are keen on benefiting from high rental yields could consider apartments in International City, which offers the highest ROI as per Bayut’s end-of-year Dubai property market report.
There are strong cases for buying both ready and off-plan property in Dubai in 2020, according to Mohanad AlWadiya. There will continue to be many incentives for buyers in the off-plan market, including lower prices by 10% – 20% and warranty on the property, too. The interest for such properties is backed by DLD’s data as well. There were 15,000 transactions recorded in Dubai’s off-plan market in 2019 as opposed to 14,000 transactions in the ready property market.
However, those who are hesitant to invest in off-plan properties, but are also limited by the lack of funds for down payments, can turn to the ready market, too, in 2020. The current market conditions mean that buyers can benefit from ready projects with payment plans, with little or no down payment required. This could translate to minimal risk for buyers, which is likely to further drive interest in the Dubai property sector in 2020.
WHAT CAN WE EXPECT FROM THE HOLIDAY HOME MARKET IN DUBAI IN 2020?
Another aspect that plays into the Dubai real estate forecast for 2020 is the emerging interest in the holiday homes market. Dubai has always remained a leisure and business hotspot for visitors across the globe, and the Expo 2020 will only increase the city’s appeal. With 25 million visitors expected in 2020, the demand for furnished and serviced residences will likely increase, bolstering the holiday home market in Dubai. The Department of Tourism and Commerce Marketing is also taking proactive steps to regulate the holiday home market. This will make it easier for homeowners to convert their property into holiday homes or buyers to invest in strategically located properties for short-term rental purposes.
The short-term rental market can also prove to be lucrative when the property is ideally located close to landmarks and attractions and offers high standards of service. Such properties can fetch around 30% – 40% higher ROI for short-term rentals than standard rental properties, says Mohanad AlWadiya.
That concludes our Dubai real estate outlook 2020. We hope this housing market forecast helps you to understand prevailing market conditions and make more informed and smarter decisions when investing or renting in the Dubai property market.
ABOUT BAYUT REAL ESTATE BYTES
Bayut Real Estate Bytes is an educational show where we discuss the latest developments in the region’s real estate and infrastructure sectors with visionary leaders, experts and government officials. The show is moderated by Dr Mahmoud El Burai, Vice President at the International Real Estate Federation and airs on Bayut’s social media channels.
Airing twice a month, Real Estate Bytes features one episode with Dr El Burai sharing his expert opinions, followed by a second episode involving a panel discussion with industry leaders. Audiences who want to understand the details discussed in the episodes and gain specific insights can send in their queries on Bayut’s social media pages.
MyBayut has a wealth of resources for buyers, investors and tenants in the UAE property market. Take a look at the best area to invest in Dubai real estate, which provides several options for buyers on a budget. Alternatively, investors can browse through the top areas to buy studios with high ROI in Dubai and Abu Dhabi, to benefit from good rental yields.
And finally, read up on MyBayut’s round-up of highlights of UAE real estate market news for January 2020!
