MAYS IBRAHIM (ABU DHABI)
The latest ValuStrat Price Index (VPI) for Dubai’s residential real estate market reveals a continued surge in capital values for ready homes in June 2024, despite a rare decline in sales transaction volumes for the first time since the pandemic.
The ValuStrat VPI for June reached 178.2 points, signifying a remarkable 28.2% increase year-on-year and a 2.2% rise from the previous month. This growth trend was particularly pronounced in the villa segment, which saw its index soar to 226.6 points, while apartments followed closely at 146.7 points, both benchmarks measured against a baseline of 100 points established in January 2021.
The average capital value of freehold villas surpassed Dh10 million, reflecting a resilient demand for luxury properties in prime locations. Notably, all established freehold villa communities exceeded their previous capital value peaks from 2014. In contrast, only Palm Jumeirah achieved similar milestones in the apartment submarket.
Month-on-month, apartment prices increased by 1.9%, contributing to an unprecedented annual growth of 23.4%. Key contributors to this surge included Discovery Gardens (34.5%), The Greens (33.7%), Palm Jumeirah (31.1%), and The Views (29.7%).
Villa capital gains were at 2.4% compared to May and 33.4% since last year. Notably, top annual performers include villas in highly sought-after areas like Palm Jumeirah (43.1%), Jumeirah Islands (42.5%), Dubai Hills Estate (38.5%), and Emirates Hills (33.6%).
Despite the overall growth in capital values, sales transaction volumes painted a mixed picture. Off-plan home registrations, measured by Oqood contracts, saw a 33% annual increase but dipped 31.9% from the previous month, following a peak in May. Conversely, transactions for ready homes declined annually by 19.4% and by 2.6% compared to June last year, marking the first such decrease since the pandemic’s onset.
In the prime segment, June witnessed 15 transactions for properties priced over Dh30 million, primarily located in Palm Jumeirah, Business Bay, Jumeirah Bay Island, Emirates Hills, and Dubai Hills Estate, reflecting sustained interest in high-end real estate offerings.
Leading developers in June 2024 included Emaar (12%), Damac (8.2%), Azizi (5.8%), Sobha (8.2%), Danube (5.4%), and Nakheel (4.5%), each contributing significantly to the market’s dynamism.
Off-plan transactions were predominantly concentrated in Business Bay (9.7%), Jumeirah Village Circle (8.2%), Meydan One (6.4%), and Arjan (4.7%), while ready home sales were prominent in Jumeirah Village Circle (8.2%), Business Bay (6.7%), Dubai Marina (6%), Downtown Dubai (4.7%), and International City (3.7%).