How The UAE Real Estate Market Is Positioned?
UAE’s real estate market is currently in its mature stage. The period during 2013-2016 was marked by a steady stream of supply, owing to increasing GDP and increased demand in the market. Increased rents led to decrease in the demand due to lack in affordability for the local people and expatriates in 2014-2015. After 2014 oil shock, the government has been actively attracting Foreign Direct Investment (FDI) and expatriates to the UAE in order to diversify their economy away from oil generated revenues. The UAE Government launched the ‘Vision 2021’ plan with an aim to focus and improve the economic and social development of the country.
From 2017 onwards, the total number of international players in each respective sub market increased. Newer segments such as townhouses, and co-working spaces, smart and green buildings emerged. Owing to continued economic growth, increased number of investments in the country, the demand for all type of real estate properties increased. Increase in the number of tourists over the years has also increased the contribution of Tourism sector to the GDP. Young couples, IT & Finance companies, leisure tourism companies, manufacturers looking for cheap land, became the upcoming target markets for various real estate sub sectors.
How Is UAE’s Residential Real Estate Market Positioned?
The UAE Government has been attracting expatriate population in order to boost their economy. The government started issuing long term residency permits called “Golden Card” in 2019. This scheme aims at providing long term residency for investors and for exceptional workers in the field of health, engineering, science and art. Until the end of 2019, 6,800 golden cards have been issued under the target to investors from across 70 countries.
Another new regulation that could have a bigger impact is the issuing of long term residency permits for executive directors earning a monthly salary of over AED 30,000.
Most of the projects that were launched during early 2014 when the market was at an initial stage of recovery are nearing handover. This has led to a buyers / tenants’ market with plenty of options and ample scope for negotiations. Developers have responded to changing market conditions by offering generous payment plans with up-to 10 years of post-handover payment options and special schemes to fully or partly absorb any transaction charges.
How Is Dubai’s Residential Real Estate Market Positioned?
The Dubai Land Department (DLD) announced the increase of registration fees from 2% to 4% in 2013. The new registration fee covers all property transactions in the emirate of Dubai except for the industrial sector, including warehouses.
Developers in Dubai’s residential property market are targeting a new buyer and tenant segment by offering innovative co-living and licensed co-working concepts.
In a bid to remain competitive and open up the market to a new segment of buyers, several developers are currently offering a range of innovative living solutions, allowing residents to live and work in the same space.
The market was hit also by the implementation of the value added tax (VAT) in January 2018. The 5% VAT currently only applies to home sales after three years of the project’s completion. Sales within three years of completion have 0% VAT rate.
Current And Future Dubai Residential Demand And Supply
The number of residential units were estimated to increase from ~ thousand units in 2013 to ~ thousand units in 2018; growing with a CAGR of ~% over the review period. The residential real estate market of Dubai has flourished in the recent past due to increasing number of expatriates, long term residency visa, employment growth and handover of new supply every year.
The real estate transactions have reached ~ in 2019 as compared to ~ number of transactions in 2008. Off-plan properties accounted for ~ transactions in 2019 owing to attractive prices and incentives being offered by landlords such as the waiving of service fees, a range of post-handover payment plans, discounts on registration charges and commissions and guaranteed rental returns.
The future supply is expected to increase from ~ units in 2019 to ~ units in 2025F; growing with a CAGR of ~ % during 2019-2025F.
Supply And Demand Gap
The supply-demand gap for residential units were wide in the years 2014-2018 as a result of high rental rates which made it difficult for people to afford residential units in Dubai. The residents and expats then moved to Sharjah and Ajman where they could find reasonable properties at affordable rents. An increase in supply which led to an over-supply situation in the market also widened the gap in these years. As the rental rates began to drop in 2018, the gap started to fill in the residential real estate market.
Key Segments Covered
UAE Real Estate Market
By Geography:
Dubai
Abu Dhabi
Ajman
Sharjah
Fujairah
Umm-Al-Quwain
Ras-Al-Khaimah
UAE Office Real Estate Market
By Type:
Premium Office
Type A Office
Type B Office
UAE Retail Real Estate Market
By Type:
Super-Regional Mall
Regional Mall
Community Center
Neighborhood Center
Convenience Center
UAE Residential Real Estate Market
By Type:
Apartments
Villas
UAE Hotel Real Estate Market
By Type:
1-3 Star Hotels
4 Star Hotels
5 Star Hotels
Hotel Apartments (Deluxe/Superior/ Standard)
Key Target Audience
Real Estate Developers
Independent Investors
Real Estate Consulting Companies
Third Party Real Estate Companies
Independent Architects
Industry Associations
Government Agencies
Time Period Captured in the Report:
Historical Period – 2013 – 2018
Forecast Period – 2019F – 2025F
Real Estate Developers Covered:
EMAAR Properties
DAMAC Properties
Nakheel Properties
Meraas
Aldar Properties
Manazel Real Estate
Aziz Developments
Case Studies Covered:
Sense-R (Virtual Reality)
Take Leap (Virtual Reality)
AirBnb (Shared Economy)
Property Finder
Bayut UAE
Abu Dhabi Mall
Yas Mall
Marriot International Group
Novotel Abu Dhabi
Surf, Abu Dhabi Creek Harbor
Emaar Business Park
Key Topics Covered in the Report
UAE Residential Real Estate Market, 2013-2025
UAE Retail Real Estate Market, 2013-2025
UAE Hotels Real Estate Market, 2013-2025
UAE Industrial Real Estate Market, 2018
UAE Co-working Space Snapshot
Disruptive Technologies Overview: PropTech in UAE Real Estate
Growth Drivers and Challenges
UAE Real Estate Market Major Real Estate Developer Profiles
Supply and Demand Gap Analysis, 2013-2025F
Major Projects Launched in Different Real Estate Markets
Recommendations about Success Factors for Developing Different Real Estate Markets
For more information on the research report, refer to below link:
UAE Real Estate Market Research Report
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Ken Research
Ankur Gupta, Head Marketing & Communications
Ankur@kenresearch.com
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