Villas and apartments in Dubai recorded strong annual capital gains in the first quarter of 2023 as the emirate’s property sector continues to rebound from the coronavirus pandemic.
Villas, which represent 13 per cent of residential homes in Dubai, grew by 17.1 per cent annually while apartment values rose by 6.6 per cent, according to a report from property consultancy ValuStrat.
Jumeirah Islands, with a growth of 5 per cent, The Palm Jumeirah (4.6 per cent), Dubai Hills Estate (4.5 per cent) and Jumeirah Park (3.8 per cent) were the best-performing areas during the quarter.
The ValuStrat Price Index (VPI) covering Dubai’s residential market grew by 11.4 per cent annually to 88 points.
The VPI for villas rose 2.4 per cent on a quarterly basis, 3 per cent shy of 2014 price peaks, the report said.
The apartment VPI grew by only 1.5 per cent quarterly, 34.2 per cent below the peaks of 2014.
The top districts with the highest quarterly capital gains for apartments were The Palm, Jumeirah Beach Residence, The Greens and Discovery Gardens.
“The month of March observed capital gains of typical villas stabilise, whilst apartments witnessed marginal acceleration for the first time since the pandemic,” ValuStrat said.
The latest report comes after Dubai and Abu Dhabi property sales surged in the first quarter amid a broader recovery in UAE’s economy on the back of higher oil prices and new initiatives by the government.
Abu Dhabi’s total sales transaction value for the three months to the end of March jumped more than three times to Dh11.6 billion ($3.15 billion), from Dh3.6 billion during the same period last year, according to real estate listings website Property Finder.
Meanwhile, Dubai’s total transaction value in the first quarter stood at Dh157 billion, marking an 80 per cent annual increase, the emirate's media office said last month.
Prime villa prices surpassed the price peaks of 2014 by 1.2 per cent in the first quarter, according to ValuStrat.
The valuation-based price index for luxury villas grew 16.8 per cent annually and 3.2 per cent on a quarterly basis.
Prime apartments recorded capital gains of 10.2 per cent annually and 1.7 per cent on a quarterly basis.
An estimated 55,863 new-build units have been put on the market so far this year while the number of total estimated completions by the end of the first quarter was 6,564 for apartments and 1,178 for villas, the ValuStrat report said.
Notable apartment completions included the Summer at Creek Beach development with 298 units, the Sunset at Creek Beach project (536), Waves Tower in Sobha Hartland (414), Binghatti Creek at Al Jaddaf development (400) and Azizi Berton in Al Furjan (245).
Based on developer schedules for 2023 handovers, preliminary estimates suggest 48,209 apartments remain under construction, with 54 per cent located in Mohammed bin Rashid (MBR) City, Dubailand, Jumeirah Village Circle and Business Bay.
An 81 per cent share of the city’s coming 7,654 villas will be concentrated in MBR City, Dubailand and Dubai South, the report said.
With higher borrowing costs, a shortage of good quality homes in some areas and attractive payment plans offered by developers, Dubai's off-plan sales volume jumped 103.5 per cent annually to 16,209 transactions worth more than Dh37 billion, representing 57.9 per cent of all residential homes sales, ValueStrat said.
The average ticket size of off-plan homes rose 22.2 per cent annually to Dh2.33 million. The citywide average transacted price for off-plan property was Dh17,783 a square metre (Dh1,652 a square foot).
The average ticket size of ready-to-move-in homes fell 5 per cent annually to Dh2.52 million during the quarter.
The sales volume of ready homes rose 13.9 per cent to 10,889 deals, equal to a total investment of Dh27 billion.
The citywide average transacted price for ready units during the first quarter was Dh14,170 a square metre (Dh1,316 a square foot).
Residential market strength also expanded to the affordable segment, according to ValuStrat.
"This quarter, Dubai Silicon Oasis, Jumeirah Village and Dubailand Residence Complex broke their individual records, with the highest number of homes traded during March, highlighting a possible shift in buyer demand towards the mid to affordable segment of Dubai’s real estate market, particularly homes priced under Dh1 million,” the report said.
Meanwhile, asking rents for new residential contracts in the first quarter jumped 33 per cent from the same period last year and 4.1 per cent from the previous quarter.
Villas led the rental increase, up 51.5 per cent annually and 4.2 per cent quarterly, to record an average asking rent of Dh380,500 a annum, the highest in 10 years, the report said.
Apartment asking rents grew by 20.7 per cent annually and 4 per cent quarterly.
Avatar: Fire and Ash
Director: James Cameron
Starring: Sam Worthington, Sigourney Weaver, Zoe Saldana
Rating: 4.5/5
ICC T20 Rankings
1. India - 270 ranking points
2. England - 265 points
3. Pakistan - 261 points
4. South Africa - 253 points
5. Australia - 251 points
6. New Zealand - 250 points
7. West Indies - 240 points
8. Bangladesh - 233 points
9. Sri Lanka - 230 points
10. Afghanistan - 226 points
Favourite book: ‘The Art of Learning’ by Josh Waitzkin
Favourite film: Marvel movies
Favourite parkour spot in Dubai: Residence towers in Jumeirah Beach Residence
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Should late investors consider cryptocurrencies?
Wealth managers recommend late investors to have a balanced portfolio that typically includes traditional assets such as cash, government and corporate bonds, equities, commodities and commercial property.
They do not usually recommend investing in Bitcoin or other cryptocurrencies due to the risk and volatility associated with them.
“It has produced eye-watering returns for some, whereas others have lost substantially as this has all depended purely on timing and when the buy-in was. If someone still has about 20 to 25 years until retirement, there isn’t any need to take such risks,” Rupert Connor of Abacus Financial Consultant says.
He adds that if a person is interested in owning a business or growing a property portfolio to increase their retirement income, this can be encouraged provided they keep in mind the overall risk profile of these assets.
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Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
The bio
Favourite book: The Alchemist by Paulo Coelho
Favourite travel destination: Maldives and south of France
Favourite pastime: Family and friends, meditation, discovering new cuisines
Favourite Movie: Joker (2019). I didn’t like it while I was watching it but then afterwards I loved it. I loved the psychology behind it.
Favourite Author: My father for sure
Favourite Artist: Damien Hurst
The specs: 2018 Ducati SuperSport S
Price, base / as tested: Dh74,900 / Dh85,900
Engine: 937cc
Transmission: Six-speed gearbox
Power: 110hp @ 9,000rpm
Torque: 93Nm @ 6,500rpm
Fuel economy, combined: 5.9L / 100km
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Sholto Byrnes on Myanmar politics
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Empty Words
By Mario Levrero
(Coffee House Press)
Company%20profile
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