A recent survey of the mood of tenants and homeowners showed that only a third of respondents believe that the fall in prices will continue in the next 12 months
The mood among tenants and property owners continues to improve, and an increasing number of people are strengthening their opinion about ending the prolonged trend of falling prices.
This trend began in 2015 and significantly worsened last year against the background of the COVID-19 pandemic. The cost of real estate, especially elite, reached historical lows by the summer of 2020 and only in 2021 began to gradually grow.
Only 34% of respondents agreed that real estate prices will continue to decline in the next 12 months. At the beginning of 2021, the share of respondents was 47%, and it was 74% a year ago.
According to a study by the Home Sentiment Agency Peninsula Real Estate, summing up the first half of 2021, the tenant community is divided approximately 50-50 between those who expect a reduction in the rental rate in the next 12 months and those who expect rates to remain or increase.
In January of this year, the share of tenants who are set to reduce rates was 64%. In 2020, the share was 84%.
However, only 2% of the respondents were completely confident in a significant increase in the rental rate in the near future, most of them believe that the current indicators will continue or slow down the variable growth.
At the same time, only 9% of property owners in the United Arab Emirates agree that property prices will fall in the next 12 months. 23% expect stability in the market and 69% are sure that the value of real estate will grow.
Christopher Payne, a senior economist at the analytical investment company Peninsula, points out: "The study confirms that people are still not completely sure, but most of the respondents express a positive attitude and believe that the market has pushed off from the bottom. Prices are expected to stabilize and gradually increase."
However, he adds that the survey results should not be taken as a guarantee that the real estate market is returning to its boom period, but certainly people are convinced that the worst is over.
It should be noted that the main share of the recovery is concentrated in the residential real estate sector, especially in the market of villas and townhouses. While the Dubai Land Department (DLD) reports a quarterly price increase of 4.9% in the family real estate sector, overall prices were 3.6% lower.
Real estate market analysis portals Bayut & Dubizzle conducted their own research, as a result of which it can be confirmed that the luxury real estate rental market grew by 5-21% (depending on the direction), while prices in the affordable villas sector remained at the same level.
Wealthy expats and investors are showing great interest in such areas of Dubai as Dubai Marina, Downtown Dubai, Arabian Ranches and Dubai Hills Estate.
The Peninsula assesses such indicators as evidence that the apartment market is still sufficiently weakened by last year's fall.
The agency points out that at the end of the first half of 2021, 26% of respondents were ready to sell their real estate on the market. In January, the share of such people was 22%, and a year ago 13%. At the same time, the number of tenants who are ready to buy permanent housing in the UAE has grown to 55%, six months and a year ago, this share was 39 and 37%, respectively.