Residential units priced under Dh1 million accounted for 41 per cent of all homes sold in Dubai last year, signifying a major shift in investment appetite within the emirate, a new study found.
Dubai registered 15,516 deals for residential units priced below Dh1m, out of a total 37,788 deals last year, real estate portal Property Finder said in a report on Wednesday.
Units priced lower than Dh1m are mostly studio and one-bed apartments, the report showed. The latest set of data indicates a shift in appetite from luxury properties to affordable units, with sub-Dh1m properties popular with first time homebuyers.
Such properties are also attractive as investments since entry prices and down payments at this level are far more manageable. Rental yields can be as high as 8 per cent to 10 per cent for the right properties, Property Finder noted.
“In H2 of last year, we started to see an increase in investor activity buying studios and one-bedrooms, presumably gearing up toward Expo 2020 with rental income in mind,” said Lynnette Abad, director of data and research at Property Finder.
Communities that registered the highest number of sub-Dh1m sales were Jumeirah Village Circle (1,473), International City (1,426), Meydan (1,079), Business Bay (976) and Jumeirah Lakes Towers (887). The average sale price for a property in JVC was Dh586,389 last year, according to the report.
Dubai registered 9,044 off-plan transactions for units below Dh1m, with Meydan accounting for most deals (1,040), followed by Dubai Hills Estate (812), JVC (783), Business Bay (768) and Dubai South (689). The average sale price for an off-plan property in Meydan City was Dh605,777, according to Property Finder.
The emirate recorded 6,472 deals on the secondary market for such properties with International City registering most deals (1,128), followed by JVC (690), Al Furjan (507), Dubai Sports City and Dubai Marina (469 each). The average sale price for a ready property in International City was Dh313,173 last year, it added.