The value of Dubai’s third quarter off-plan transactions jumped 118 per cent to Dh4 billion from the previous quarter, while there was a decline in the value and volume of sales of completed properties, a real estate consultancy said.
The number of off-plan deals in the third quarter climbed 86 per cent from the previous quarter, diminishing interest in built up units, whose volume fell 11 per cent and value plummeted 19 per cent, Chestertons Mena said.
“With reference to off-plan transactions, Dubai’s real estate market has witnessed seasonal peaks and troughs in the last year due to high levels of uncertainty,” said Ivana Vucinic, the head of advisory and research at Chestertons Mena.
“After a promising start to 2017, sales plummeted during a disappointing Q2. However, they have picked up positive momentum in Q3.”
Downtown Dubai accounted for half of the value of off-plan transactions in the third quarter, while Dubai South led in the volume of transactions with 1,151 deals, Chestertons said.
Downtown Dubai came second in terms of volume with 821 transactions, followed by Business Bay with 686.
“In Q4 we expect to see further corrections of sales prices and rents,” said Ms Vucinic. “A slight pick-up of completed unit transactions is expected. This will, however, have a negative impact on off-plan sales transaction, which we expect to decline and then stabilise.”
Apartment sales price fell 2 per cent in the third quarter, which could lead to further drops in completed unit values because investors are increasingly interested in off-plan properties that offer easy payment options.
Residential property transactions in Dubai are rising, but the price trajectory remains unclear as developers selling off-plan units drive down prices in the affordable housing sector and create a stock of low-quality residential units in the emirate, brokers say.
The number of deals for built units since the beginning of this year has increased by 7 per cent year-on-year, while off plan sales jumped 62 per cent, according to the estate agents Core Savills.