Demand for luxury rental properties in Dubai spiked in Q2, report shows

Secondary residential market transactions in Dubai remains stable in the second quarter of 2018, with a total volume of AED 12.1 billion ($3.3bn), compared to AED 14.4 billion ($3.9bn) in Q1, according to a new analysis from high-end property brokerage Luxhabitat.
According to the data, over 1,400 villas and 6,652 apartments were transacted over the course of the quarter.
Additionally, the report found that off-plan market activity in Dubai continued to stabilise in Q2, with several new launches during the quarter. According to Luxhabitat, off-plan transaction volumes and the overall number of transactions fell almost 28 from the previous quarter, with a total of 80,000 units scheduled for completion in 2018.

Best prime residential areas in terms of gross rental yield

Area Average gross rental yield (%)
  Jumeirah Village Circle 7.96
  Jumeirah Lake Towers 7.52
  Emirates Living 7.15
  DIFC 6.22
  Dubai Marina 6.00
Source: Luxhabitat x Property Monitor Analysis, July 2018

The data indicates that the prime residential market in Q2 totalled AED 3.5 billion, with secondary villa sales volume double that of off-plan sales during the quarter.
Of the areas recognised by Luxhabitat as prime residential, the top performers in terms of sales volume were Business Bay with AED 2.3 billion in transactions, followed by Mohammed bin Rashid City with AED 1.9 billion and Dubai Marina with AED 1.2 billion.

Spike in luxury

With regards to rent, Ryan Kasper Luxhabitat’s rentals director, noted that while rental prices continue to fall across Dubai, a “considerable demand for high-end, luxury rental properties has spiked.”

“This, in turn, has sparked a trend among landlords who are reinvesting and upgrading their properties to compete with the many new and modern developments recently handed over,” he said. “So far, this year has reinforced that Dubai remains one of the most active and versatile rental markets in the world.”

Top 5 villa transactions

  Development Price Average Plot size
  Fronds, Palm Jumeirah 40,000,000 14,451
  Fronds, Palm Jumeirah 24,563,400 13,406
  Jumeirah Bay island 21,800,000 13,698
  Fronds, Palm Jumeirah 20,000,000 13,404
  Al Barsha villa 20,000,000 11,097
Source: Luxhabitat x Property Monitor Analysis, July 2018

Going forward, Kasper said that “we anticipate stabilising rental prices as we continue to adjust to the conditions of a maturing market, which should come as positive news for everyone,” he said.
The report noted that the best rental yields in Dubai were in Jumeirah Village Circle (7.96 percent), Jumeirah Lake Towers (7.52 percent), Emirates Living (7.15 percent), DIFC (6.22 percent) and Dubai Marina (6 percent).

Top 5 apartment transactions

Price Average BUA (Built Up Area)
  Il Primo 43,098,888 11,550
  The One at Palm Jumeirah 31,500,000 9,223
  Bulgari Resorts & Residences 24,993,000 7,085
  Jumeirah 1 apartment 24,500,000 11,159
  The One at Palm Jumeirah 22,363,500 7,162
Source: Luxhabitat x Property Monitor Research, July 2018

Source : Arabian Business

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