The prices of plots designated for villa and residential building developments in Dubai have witnessed a substantial surge of up to 60 percent. This surge can be attributed to the heightened enthusiasm surrounding new projects, a response to the unprecedented demand emerging in the post-pandemic era.
Several key areas in Dubai, including Business Bay, Downtown, Marina, and Palm Jumeirah, are currently experiencing either a scarcity of available plots or are nearing full capacity, leaving only a limited number of plots for the construction of new towers.
According to real estate industry experts, the surge in demand and prices is particularly notable in beach-front properties, with significant increases observed along the E-11 highways such as Marina and Palm Jumeirah, as well as in the Downtown and Business Bay areas.
Adding to the dynamics, a noteworthy influx of new developers from Europe, Asia, and the Middle East has entered Dubai’s property market, driven by the prospect of higher returns. This influx has further fuelled the demand for plots intended for property development.
Additionally, the emergence of mega-communities in the emirate, exemplified by projects like the $20-billion The Oasis by Emaar and the Dh30 billion Venice by Azizi Developments, has contributed to an even greater demand for the development of residential projects.
“Residential villa plots, especially in upscale sectors such as Jumeirah Bay, Palm Jumeirah, Pearl Jumeirah, and La Mer South Island, have encountered significant escalations in prices. The average price surges in these locales vary between 25 percent and 30 percent, with Jumeirah Bay recording even more substantial increases, ranging from 45 percent to 50 percent.”
John Allen, CEO of valuation and advisory at Asteco Said:
He noted a notable escalation in prices for non-beachfront plots in Pearl Jumeirah, while areas characterized by a scarcity of vacant plots, like Emirates Hills, are experiencing heightened competition for available plots. Additionally, there is a surge in redevelopment and refurbishment projects in these areas.
“In secondary areas where plots are designated for self-build, including The Villa, Jabel Ali Hills, and Al Mamzar, there has been a noticeable uptick in prices, typically falling within the range of 15 percent to 25 percent over the course of the year.”
Rizwan Sajan, the chairman and founder of Danube Group, highlighted that plot prices have experienced an increase ranging from 20-30 percent in most areas, with select locations witnessing a more substantial surge of 50-60 percent.
Notably, Danube Properties embarked on projects surpassing Dh10 billion in value last year, with notable developments such as Oceanz in the Maritime City.
“In Maritime City, there has been a notable surge in plot prices, with an increase of 50 percent.”
He anticipates a significant increase in the plot prices for its upcoming development, Bayz, located in Business Bay.
He explained,
“There are currently no available plots in Downtown, and within the next 6 months to 1 year, obtaining plots in Business Bay will become increasingly challenging. The remaining plots are limited. The acquisition of any plot in Downtown or along the seafront is poised to experience a rapid escalation.”
Sajan expressed his expectation that the prices of apartments in the newly-launched Bayz, situated just a short distance from Dubai Mall and the metro station, will likely see a surge of 50-60 percent, if not a potential doubling upon completion. He emphasized that projects situated on plots facing the sea tend to yield higher returns for investors purchasing apartments in such developments.
Highlighting the rental aspect, Sajan noted, “Similarly, rentals are also going to be higher in such projects.”
John Allen of Asteco concurred, stating a high demand for residential villa plots in sought-after locations like Jumeirah Bay and Palm Jumeirah. He also noted robust demand for commercial development plots in strategic areas like Business Bay and Dubai Water Canal. Commercial development plots with canal frontage, in particular, have experienced a remarkable increase of around 60 percent in just one year.
As several established master plan communities, including Emirates Hills, have reached full capacity in terms of available plots, Allen pointed out that plots are most scarce in communities along the E11 Road Corridor, such as Dubai Marina, Downtown Burj Khalifa, Palm Jumeirah, and Business Bay. Additionally, masterplan-scale development plots in secondary locations, like the E311 – E611 Road corridor, have become increasingly rare, resulting in unfulfilled developer mandates.
However, Allen highlighted that there are still various residential communities offering a range of choices, including Jebel Ali Hills, Meydan, and Nad Al Shiba. In the commercial sector, multiple plots are available in secondary located master developments such as Al Jadaf, International City Phase 2, Dubai Land Residence Complex, Liwan, Arjan, Majan, and Jumeirah Village Circle (JVC).
News Source: Khaleej Times
