Dubai Residential Prices and Rents to continue to boom in Dubai in 2022
Property prices and rents in Dubai’s residential market will continue to rise in 2022, just like the trend in 2021, making Dubai one of the emirate’s strongest economies. This year will see an increase in prices as well as rents and will witness strong sales which will help developers to launch new projects.
Properties are also rather affordable with prices 25 percent to 30 percent below 2014 levels, even though there was a significant increase in 2021.
The main income of Dubai comes from the high oil prices, tourism, real estate, and investments which is a rather positive factor for investors. There is a great demand for properties as it is known as a safe haven.
The UAE’s property market has successfully recovered from the coronavirus-induced slowdown because of the government-induced initiatives such as residency permits for retirees and remote workers, also the expansion of the 10-year golden visa program.
The value of the deals in property more than doubled last year and broke a record of 12-year in line with volumes, DLD claimed. The emirate made 61,241 sales deals worth Dh 151.07 billion ($41bn) in 2021, making it the best year of transactions since 2013 and the highest in line of value since 2009.
The trend has continued this year as well. Total residential activity in Dubai rose 34% annually to Dh 15.5 bn in February, with 6,913 units sold.
The addition of over 30,000 units over 2022 should lead to moderate price and rent increases.
On the back of the buoyant market, the developers will see revenue growth over the next four to five years, which will be supported by a steady supply of residential properties and new developments. Developers such as Damac and Emaar Properties have benefited from a strong rebound in cash flow from operation in 2021 after they delivered a large number of units launched back in 2016 and 2017.
While higher prices of energy sources and cost inflation will drive companies to focus on cost efficiencies, developers are protected from the effect of higher raw materials costs in the short run, which are borne by contractors.