Off-plan Dubai real estate market sales recorded a significant growth of 36.7% during the first five months of this year to 79.6 billion dirhams, compared to 58.2 billion dirhams in the same period last year. These record numbers represent the highest value ever for sales of Dubai properties under construction during this period.
Data from the Land Department showed that the number of off-plan sales transactions increased by G.7 on an annual basis during the first five months of this year, to about 37.8 thousand transactions, compared to 25.6 thousand transactions in the same period last year. Off-plan sales accounted for 42.7% of the total sales achieved during the first five months of this year, which exceeded 186 billion dirhams.
Residential apartments accounted for the largest share of off-plan Dubai real estate market sales during the analysis period, amounting to 67.7 billion dirhams resulting from 34.3 thousand transactions, while sales of villas under construction amounted to about 11.1 billion dirhams resulting from 3.1 thousand transactions.
In addition, REIDIN Data Analytics, a company specializing in real estate data, said that the Dubai real estate market’s appetite for residential apartments under construction knows no bounds, stressing that both investors and end users still prefer newer buildings over ready-made ones, especially after the Covid-19 pandemic.
The company said in its analysis of the difference in price movement for ready apartments and apartments under construction in the Dubai real estate market, that since January 2012, apartments under construction have been constantly sold at higher average prices per square foot than their ready counterparts, and this trend has strengthened in the post-pandemic period, as both investors and end users are continue showing their preference for newer buildings.
The institution added that this effect applies to a group of communities, whether at the luxury or middle market level, and in general, apartments under construction were sold at relatively higher prices compared to their ready-made counterparts, and this is especially true after Covid for a sample of communities that were responsible for a large percentage of apartment transaction volumes in Dubai over the years.
REIDIN stated that if we focus more on examining this phenomenon on a more detailed basis, we will find that it is also consistent at the level of each individual building. It continued: “In the same communities that were examined on a comprehensive basis, there are a number of examples of projects under construction that were delivered in 2023, where the average selling price was higher than the average selling price of ready apartments in the same community. Moreover, we are witnessing a decrease “In prices in these same buildings once the finished units start selling, once again demonstrating the market’s insatiable appetite for newer buildings.”