We asked a selection of agents, developers, property data analysts for their views on what will happen in 2018. Here’s what they said.
Ozan Demir, operations and research, Reidin
Although rental yields have trended lower structurally since 2009, of all the major cities analyzed, Dubai remains far and above the highest yielding city, suggesting that there is ample room for further yield compression. In the demand and supply equilibrium in the first nine months of 2017, level of transactions were still 40 per cent less than the peak in 2013-2014, but the number of transactions have risen by more than 20 per cent compared to the same period in 2016. On the other hand, upcoming supply is expected to reach 140k units in the next couple of years. If the project realization rate by the developers increase (50 per cent in the last 3 years) that may prevent prices to move upwards and also pressuring the rentals.”
Ibrahim Al Ghurair, founder of Muraba Properties
In a market full of real estate opportunities, one can now be more and more selective. After a huge boom in recent years, the real estate market in Dubai is maturing. With this maturity comes higher expectations from buyers and demand for properties with finer design elements and of higher quality. The need for differentiation will play a key role in the luxury market in 2018. In terms of integration of the exterior with the interior, the finishing, quality of fittings and fixtures, and overall attention to detail will be important. We have tried to address this with our first project Muraba Residences on Palm Jumeirah.
Anton Yachmenev, Managing Director of Forum Group
The property market in Dubai is constantly improving and, it is experiencing many changes that will have an impact on the luxury sector. The luxury sector is a unique in Dubai. There is an oversupply in the so-called “upper scale segment”, but a huge number of those properties don’t epitomize true luxury. What we do expect to see in 2018 is the emergence of sophisticated buyers in the luxury market who have actually done their homework. We will start to see buyers who understand the distinction between true luxury and aspirational luxury and that is a huge positive for us.
Alexander Von Sayn-Wittgenstein, luxury sales director, Luxhabitat
For buyers in 2018, check the developer’s reputation and take location and completion dates into consideration while negotiating price. As for sellers, the prices are expected to flatten further so don’t be in a hurry to sell your property just yet. Renting it would be a good option instead.
Marion Volpi, chief sales officer of Kensington Properties
One of the trends for 2018 will be affordability, but affordability will have to come at a cost and I’m not referring to financial terms. We are currently experiencing a somewhat challenging property market, where prices are naturally soft but in order for developers to keep the ticket prices of residential property at what can be described as affordable to the average person, the actual size of the finished unit will have to be reduced. We have seen this trend already occurring by many developers in locations such as JVC, Dubai South and Dubailand etc. Building smaller units will continue next year as this will guarantee the property’s affordability. Buyers or investors will now have to get used to smaller sized property units when choosing the “affordable” option.”
Paul Spargo, commercial director, Propertyfinder
The trend of decreasing prices across the market continues as observed since their peak in mid-2014. Falling prices makes buying a property more realistic for a larger Dubai population. Renters are moving into the buyer category, preferring to pay off their own mortgage, instead of their landlord’s. Dubai villa rents have experienced the biggest decline of all the categories. This may be due to a significant number of affordable villas released to the market in areas such as Jumeirah Village Circle and Al Furjan. Looking to 2018, price decline may continue to ebb, and transactions – especially for the middle-income segment – are expected to remain strong.
