The market sentiments are usually mixed when it comes to investing in off plan segment of real estate. Look the term up, and besides the definition, many people mention the cons of investing or opting for such projects. However, that is the case until you check for off-plan properties in Dubai. Before we continue forward, let’s get the meaning of off-plan out of the way, it is any property you buy before it is built, just in the plans, or the construction is yet to begin.
Now back to Dubai real estate; given how much in-demand properties are in the region, you can quickly conclude that any new projects would be picked up immediately. However, this blog will put this into perspective by mentioning some statistics and figures from 2022 and some significant developments that took place in this year and also what we can expect in 2023.
Dubai real estate experienced phenomenal growth in 2022
Dubai real estate touched AED30 billion mark this November 2022 and overall, the market saw a record-breaking year in 2022, with 88,028 sales transactions recorded as of November. The Emirate saw a 65% growth in property transactions and a 71% increase in value compared to 2020. The total number of investors acquiring new properties in the Emirate was 52,415, and the property market recorded a total of 84,772 transactions valued at AED 300 billion in 2021.
The most popular areas for buying property were Dubai Marina, Palm Jumeirah, and Arabian Ranches, with the highest transaction value at over AED 28,6 billion for Dubai Marina.
Off-Plan properties in Dubai driving majority of growth
Off-plan properties in Dubai have become very successful due to their numerous benefits such as they tend to be less expensive than ready units. You can continue reading to know in detail top reasons to invest in Dubai off plan properties but a few pointers are also mentioned here. For instance, before being handed over, these properties can often be tailored to some degree during the construction phase, subject to approval, and can be sold for a profit before completion. They also serve as a viable alternative investment option, providing a lower buying cost and the ability to generate additional cash flow compared to completed developments.
They can also provide diversification of one’s portfolio. Furthermore, the UAE’s strong economy and real estate market provides a great return on investment. According to Zazen properties, a real estate developer in the UAE, Dubai’s off-plan segment witnessed a staggering surge of 92.5% in 2022. The up-tick in off-plan real estate purchases indicates a resurgence of developers launching new developments to keep up with the increasing demand.
The off-plan sector’s outstanding performance drove this growth. A shortage of high-quality, move-in ready developments has led to the under-construction segment in Dubai recording a value of over AED 12.7 billion for the first time in a decade, representing an 87.1% increase and almost double the AED 6.8 billion value recorded in November the previous year.
Off-plan sector’s growth is expected to continue in 2023
According to the latest predictions from Realiste’s artificial intelligence technology, Dubai real estate segment is expected to experience a substantial increase of more than 42% in 2023. This is an increase from the average 20-40% price increase seen in the previous year. Economic experts are particularly forecasting those areas that have previously seen low growth, such as Wadi Al Safa 4, Hessayan First, and Al Yalayis, will experience the most significant development during this peak.
In part, this is boosted by the D33 announcement by Sheikh Mohammed, which is an economic plan worth $8.7 trillion that has been put into place with the goal of increasing foreign trade and investment by 2033, thereby reinforcing Dubai’s standing as a major financial center on the global stage.
Foreign investors lead the way
According to S&P Global report, international investors attract to Dubai’s safe haven status and the statistics also show that a majority of the city’s property transactions, around 75%, are made by overseas investors, and there has been a growing interest in off-plan properties. In 2022, more than 84,000 property transactions were recorded, surpassing the previous record of 81,182 transactions in 2009. The UAE’s real estate market is predicted to experience annual growth of 8% through 2027.
As of 2022, Dubai has attracted the most high-net-worth individuals (HNWIs) of any country in the world this year, with 4,000 HNWIs moving to the city. This number is in addition to the nearly 70,000 millionaires already living in Dubai and seeking to acquire real estate in sought-after locations.
Other reasons behind this growth
Increasing demand for luxury properties
In 2022, Dubai real estate witnessed another record showing impressive numbers of transactions took place for luxury properties. Robust demand conduces the launch of luxury projects in Dubai and the trend will continue in 2023 as well. Experts now anticipate that not just the demand but the property prices in Dubai, particularly in areas such as Palm Jumeirah, will rise significantly due to the imbalance between low supply and high demand.
FIFA World Cup 2022
The Qatar FIFA World Cup brought a tourism surge to GCC states, and many FIFA World Cup visitors showing high interest in Dubai real estate projects. Upon fractional analysis, it is observed that these visitors preferred off-plan properties as an attractive investment opportunity.
High ROI and premium lifestyle
Experts and property agents in Dubai anticipate that as the number of villas in special districts like Arabian Ranches, Palm Jumeirah, and Dubai Hills Estate increases, the Dubai real estate market will draw more potential investors in the near future, leading to a significant increase in 2023.
Some off-plan properties in Dubai to look out for in 2023
From townhouses to Villas to apartments and penthouses, here are a few off-plan properties to look out for in 2023.
Farm Garden Villas by Emaar
Farm Gardens Villas at The Valley by Emaar is a newly launched development offering luxury 4-5 bedroom villas in the Valley, surrounded by nature. These villas have superior features, such as a full-width swimming pool, an attractive internal layout, and everything needed for a tranquil, modern lifestyle. The amenities at the Farm Garden villas are attractive, including a wealth of luxurious design features and top-notch amenities that promote an active lifestyle. Parks and gardens, retail, and restaurants are all within walking distance. Farm Gardens Villas is conveniently located near Al Ain Dubai Road, making it easy and flexible for residents to access various attractions and amenities.
Elie Saab Vie Meydan City by G&Co Properties
Nestled within the prestigious area of Meydan in MBR City, Elie Saab Vie in the Fields is a stunning new phase two of the Elie Saab Townhouses project by G&Co. The complex offers a variety of amenities and facilities, such as a swimming pool, fully equipped gym, spa, sauna, steam room, children’s play area, and a multi-purpose room. Residents can benefit from its excellent location in Meydan, adjacent to significant monuments and destinations.
Da Vinci Tower Dubai
Da Vinci Tower is a multi-building complex in Business Bay, Dubai. The development comprises two buildings: Da Vinci Tower A and Da Vinci Tower B. The tower includes 19 floors, three basement levels, and a ground-floor lobby. Residents can enjoy the stunning view of the Dubai Canal on the southeast. Located in one of Dubai’s central neighbourhoods and surrounded by scenic vistas, these 2-4 bedroom apartments come in various layouts.
They offer beautiful views of the canal, Burj Khalifa, and the Downtown Dubai skyline. The tower also features a state-of-the-art design with luxury features, such as a swimming pool, fully equipped gym, spa, sauna and steam room, children’s play area, and a multi-purpose room. The residential building is situated close to the main highway of Dubai – Sheikh Zayed Road.
Conclusion
We hope we were able to give you valuable insight into the off-plan sector of the Dubai Real Estate market. People are afraid of off-plan offers due to delays and risks of non-completion or lack of transparency, which the government of the Emirate ensures does not happen. That is another major success factor behind off-plan properties in Dubai.
The government of Dubai has established laws and regulations to protect the rights of real estate buyers and to ensure the completion of real estate projects. The Dubai Real Estate Regulatory Agency (RERA) regulates and supervises the real estate sector in Dubai. RERA ensures that all real estate developments comply with the Emirate’s laws and regulations and that buyers’ rights are protected.
Call us today!
If you are interested to invest in any of the above-mentioned real estate projects in Dubai or anywhere in this emirate; pick up your phone and give us a call at +971 4876 2473 or you can also write us at info@hfre.ae and we will help you make this decision in a seamless way.
