ValueStrat, a real estate consultancy and research firm, said that 85% of villa complexes in Dubai have more than doubled in value compared to four years ago, confirming that capital gains in the emirate’s residential real estate sector have maintained their strong momentum, exceeding market expectations.
ValuStrat added in its August report that the ValuStrat Price Index for August recorded 186.1 points, an increase of 28.8% year-on-year, with a monthly increase of 2.2%, and the index reading for villas rose to 237.7 points, and apartments 152.5 points, compared to 100 basis points in January 2021.
According to ValuStrat, whose data is based on a fixed basket of properties that represent the market as it describes it, 85% of villa communities in Dubai have more than doubled in value compared to what they were four years ago, and prices have surpassed previous peaks in the past decade, with the value of Palm Jumeirah villas nearly doubling since 2014.
Capital gains for villas amounted to 2.4% on a monthly basis and 33.5% on an annual basis. The best annual performance for villas was recorded in the most sought-after areas of Palm Jumeirah (42.9%), Jumeirah Islands (42.4%), Dubai Hills Estate (36.9%) and Emirates Hills (34.3%).
On a monthly basis, apartment prices rose by 2%, maintaining a record annual growth of 24.4%, with areas that achieved the highest capital gains for apartments compared to last year including Discovery Gardens (34.2%), The Greens (33.6%), Palm Jumeirah (30.3%) and The Views (30%).
Off-plan home transactions grew by 3.4% month-on-month and 46.4% year-on-year, accounting for almost three-quarters of all home sales during the month. However, the volume of secondary ready home transactions declined by 15.8% month-on-month but remained 10.2% higher than the same period last year.
There were 13 transactions for ready properties priced above Dh30 million, across Palm Jumeirah, Emirates Hills, Jumeirah Bay Island, Dubai Hills Estate, Bluewaters Island, Jumeirah Golf Estates and District One.
August sales were led by residential properties developed by Emaar (22.5%, up from 13% in February), Sobha (8.7%), Azizi (5.8%), Damac (5.5%), Danube (5.2%), Meraas Developments (3.5%) and Samana (3.4%).
The top locations that saw off-plan transactions included projects in Jumeirah Village Circle (9.6%), Dubai South (8.3%), and The Valley (7.7%), while the majority of ready homes sold were in Jumeirah Village Circle (7.2%), Business Bay (5.7%), Dubai Marina (5.3%), and Downtown Dubai (5.3%).
According to the report, Palm Jumeirah continues to record the highest average price per square foot for villas at AED 5,629 per square foot, up 42.9% year-on-year, while the average price of a standard villa in the area stands at AED 28.1 million. Emirates Hills came in second with an average price of AED 4,170 per square foot, while the average price of a standard villa stands at AED 70.8 million.
Jumeirah Islands moved up to third place, ahead of Dubai Hills Estate, with an average price of AED 2,521 per square foot, up 42.4% year-on-year, the second best performer after Palm Jumeirah, while the average price of a standard villa in the area is AED 13.3 million.
The report data showed that the Burj Khalifa area still has the highest average price per square foot for apartments, at AED 3,355 per square foot, up 18.6% year-on-year, while the average price of a standard apartment in the area is AED 3.1 million. Downtown Dubai came in second with an average price of AED 2,170 per square foot, while the average price of a standard apartment is AED 1.8 million. Palm Jumeirah came in third with an average price of AED 1,993 per square foot, while the average price of a standard apartment in the area is AED 3.4 million.