Dubai: Dubai Marina and Business Bay are the most popular investor hot spots in Dubai, but when it comes looking for property at Dh800 a square foot, buyers are heading south.
At Dubai South, “the majority of projects launched to date are in line with the average pricing of 800 [a square foot] ,” says a new report from Reidin-GCP. This price band is in keeping with the location’s credentials as a suburban community in the making.
But as the master-development scales up, all 145 square kilometres of it, today’s prices could start heading north. “The launch prices are an attractive entry point for investors who would like capitalise on future gains as the community gravitates towards urban prices,” the report adds.
And those investors are already making a beeline for the South. “When comparing the first seven months of 2017 against the full 2016 we can witness an increase of 285 per cent,” the report states. “Off-plan sales will continue to rise as the community gears up for the Expo 2020, and as developers increase their offerings in this area to cater to latent demand.” A staggeringly high 76 per cent of overall transactions in this area have been for properties below Dh1 million, “indicating that developers have been able to cater to this sweet spot of investor demand”.
One- and two-bedrooms represented 64 per cent of total sales at Dubai South… “unsurprising given the fact that the pricing have been in the more “affordable” category relative to the rest of the city.”
At the same time, 22 per cent of transactions conducted have been in the three-bedroom segment, indicating a “healthy level of end-user demand”.
Since 2014 more than 6,000 units have been launched there and another 28,000 units in their planning stages. Once the community living aspects take their full shape, it will be home to nearly a million residents.
“We expect the number of developments offered to ratchet significantly higher in 2018 and 2019; this is also expected to lead to an upward trajectory in prices as developer demand exerts pressure on land prices, as well as attract developments that cater to more affluent categories,” the report notes.
