Dubai’s residential and ultra-luxury markets have continued their upward trajectory in 2022, with demand from international buyers resulting in high competition and several record-breaking sales. Driven Properties in Dubai is a leader in the luxury and ultra-luxury market. Founder and CEO Abdullah Alajaji recently sat down to discuss 2022 market dynamics and what’s driving the real estate boom in Dubai.
What does Dubai’s current market look like coming out of Q1?
AA: We just witnessed one of the best quarters ever recorded. The total transaction volume from January to March 2022 was the highest Q1 to date, with sales values of over USD 15.3 billion and over 20,000 transactions. Apartment sales accounted for most of these transactions. Off-plan sales (new developments) were up nearly 95% and secondary market sales (resales) were up nearly 75%. Compared to Q1 2021, there were 77% more apartments, and 58% more villas were sold.
This overall upward trend in Dubai’s property rental and sales prices can be attributed to the emirate’s efficient policies, a strong recovery from the pandemic, as well as visa reforms that are contributing to Dubai’s popularity as a long-term residence. We saw strong demand for spacious villas and townhouses which is a continuation of the trend in post-pandemic purchases. Branded residences continue to be a popular choice with both locals and ex-pats.
What do the prices look like compared to six months ago?
The luxury segment was outperforming all others, and the prices continue to go up. This is especially the case in the ultra-luxury segment where the lack of supply caused prices in certain areas to double. We recently fully sold out one of the most luxurious projects in Dubai-Sea Mirror, where the average price per villa was around USD 20 million. Mid-range properties are always popular and sought after. Those prices are not rising at the same speed as in the luxury segment, the increase has been slower, but steady. The affordable end of the market is the one with the least changes in prices in the last six months.
Tell us about Dubai’s culture in 2022.
Dubai is a cosmopolitan city where everyone feels welcome, as it has been the case for years. We are very lucky to be in the city that is the bridge between East and West, making the Emirate a perfect destination for a second home.
Who are some of the buyers and sellers you are working with?
Buyers and sellers are coming from all around the world. If I had to identify the most active groups at the moment, it would be the following: the buyers are mostly coming from Europe, primarily France, Germany, and Switzerland, with a strong presence of CIS nationals. Of course, locals and Saudis are always an important part of the equation. There is a similar mix on the seller’s side.
What is your forecast for the rest of 2022?
We are entering Q2 evident of increased activity. Some of the largest single transactions were recorded recently in April, and the first quarter was groundbreaking. Dubai is lively and bursting with people. One can just have a glimpse at the hotel rates and understand how busy and popular it is. Expo 2020 is now behind us, and hotels are still fully booked, many with rates higher than during the prime winter season, with no sign of slowing down. Based on that, we expect similar activity in Q2. We are keeping a close eye on all the changes happening and have many reasons to stay optimistic in the coming months.
Driven Properties is an exclusive member of Forbes Global Properties, a consumer marketplace and membership network of elite brokerages selling the world’s most luxurious homes.