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Off-plan property prices in Dubai dipped in August after a strong rally that saw prices rising at a double-digit rate over the past few years as investors are moving towards ready-to-move-in properties. However, analysts said that the drop in prices is not a reflection of the market's weakening but “recalibration towards price equilibrium,” and off-plan properties remain the preferred option for investment in Dubai. According to data shared by Betterhomes, the average price per square foot for off-plan sales declined 4.
2 per cent to Dh1,866 in August 2024 compared to Dh1,948 in August 2023. Stay up to date with the latest news. Follow KT on WhatsApp Channels.
“This moderation reflects a natural balancing after the rapid price growth of 2023, driven by an increase in new project launches and supply, which eased some pressure on prices. As we have almost reached the last quarter of 2024, the market has shown resilience and signs of stabilisation with consistent month-over-month growth,” Betterhomes analysts said in a note on Thursday. “We’re now seeing off-plan prices trending lower, but this doesn’t signal a weakening market — rather, it’s a healthy recalibration towards price equilibrium.
One of the primary reasons behind this shift is the growing preference among investors for ready-to-move-in properties,” said analysts. According to Emirates NBD Research, 10,470 units or 66 per cent of the total transactions in August were off-plan properties. While the overall demand and market sentiment across the city has improved over the last few years, the off-plan segment has seen the biggest jump in transaction volumes.
To put this in context, in 2018 a total of 17,600 off-plan units were sold across Dubai while more than 69,100 off-plan units have already been sold in the year through August 2024. At current transaction levels, Emirates NBD Research sees more than 100,000 off-plan transactions for the full year, around a 468 per cent jump in transaction activity compared to 2018. In the first quarter of 2024, according to Betterhomes, ready properties accounted for 54 per cent of all transactions, compared to 46 per cent for off-plan, a significant shift in investor priorities.
Rising demand for ready properties “Buyers are increasingly looking for immediate returns through rental income or occupancy rather than waiting for construction to be completed,” said Betterhomes..
