Following a brief hiccup created by COVID-19, it is fair to say that villas have been the driving force of the Dubai housing market. Apartments have also done well, but there has been a noticeable uptick in the volume and value of sales of villas in Dubai.
August was a record-breaking month:
In August 2021, the Dubai villa market grew by double digits. With 5,780 sales worth Dh14.97 billion, it has already surpassed December 2013 as the second-highest month in terms of sales volume. Previously, January 2017 held the second-highest number of sales transactions in a calendar month.
With these numbers, the total number of transactions worth AED88.12 billion in 2021 has reached 37,537. According to statistics, the overall number and value of transactions in 2021 have already eclipsed those in 2020, when the Dubai property market recorded 35,401 transactions for AED71.87 billion.
Let’s look at the important variables that contributed to Dubai’s strong success in the villa market:
Investors returned to the Dubai property market in the second quarter. As a result of the positive outcomes achieved in Q1, 2021, a greater number of investors entered the market. This resulted in higher sales volume and prices, especially in the residential sector. The COVID-19 situation in Dubai, which was kept under tight control, also had a role.
Investors took advantage of the trend toward villas, resulting in an increase in the number of transactions for these isolated dwelling units.
A Growing Demand for Larger and More Spacious Homes:
When the first wave of COVID-19 hit Dubai in early 2020, stranding residents in their houses, many people realized the value of having outdoor spaces and larger dwellings. The demand for villas and townhouses skyrocketed as a result. According to statistics, searches for villas and townhouses increased by 58 percent in July 2020 compared to the same month in 2019. The trend is still going strong, with Emiratis preferring to live in larger, more spacious homes with plenty of outdoor area.
Expo 2020 is scheduled to take place in 2020:
Expo 2020 Dubai, a highly anticipated global event, is just a few days away. The exhibition, which is expected to attract visitors from over 190 nations, will run for six months, beginning on October 1, 2021. The need for housing in the areas surrounding the Expo 2020 site is projected to expand. Similarly, hotels and resorts are likely to be busy throughout this time.
With so many people flocking to Dubai, many will be looking for apartments and villas for rent in Dubai, as well as other short-term rental choices. When the exhibition opens, investors and end-users anticipate an increase in rental income.
A High Return on Investment:
Even as demand for villas in Dubai has increased, the return on investment has improved. Other key aspects that aid investors in earning a good ROI from villas are competitive rates (especially in a competitive market).
As seen by the increased demand for villas for rent in Dubai, these properties are yielding a greater rental yield, drawing more investors and end-users.
High Achievements in Key Areas:
Many villa communities in Dubai have experienced tremendous wealth increases. With 22 percent capital gains, Arabian Ranches remained in first place, followed by Jumeirah Island (20.8 percent). The Lakes and Dubai Hills Estate both grew by 18.5 percent and 18.3 percent, respectively.
The performance of major sections of flats was uneven, with some showing single-digit annual growth compared to villas’ double-digit growth. However, with the arrival of Expo 2020 Dubai, demand for flats is projected to increase. Palm Jumeirah, Jumeirah Beach Residence, and Al Furjan all experienced growth of 6.8%, 6.1 percent, and 4.6 percent, respectively, shedding insight on significant housing regions.