● In July, real estate sales transactions grew by 3.7% month-on-month and averaged around 600 properties sold in Dubai every seven days.
● The secondary market in July 2020 had higher volumes of sales transactions than off-plan transactions, a trend recorded since the end of Q2 2020
Dubai, UAE, 7 September 2020: Dubai Land Department (DLD), in cooperation with Property Finder, launched the fifth edition of Mo’asher, Dubai’s official sales-price index. The base year for Mo’asher is 2012 and the base month for the monthly index is January 2012, with the base quarter for the quarterly index being Q1 2012.
In July 2020, DLD recorded a total of 2,404 sales transactions worth AED 4.69 billion, with 29.6% in the off-plan segment and 70.4% in the secondary segment. This brings the year-to-year total to 18,168 sales transactions worth AED 36.99 billion.
Latifa Ibrahim Ahmed, Director of the Real Estate Studies & Research Department at DLD, said: “Through the regular issuance of Mo’asher, we aim to provide transparent and accurate data to all parties in the real estate market, including developers and investors as well as local and international media and analysis agencies, especially as the index is receiving increased attention. We believe that providing these detailed data on a monthly basis will place Dubai’s real estate market on the list of the most transparent markets, helping investors make information-based decisions and develop long-term plans for their investments, especially in light of the interest of financing companies and global investment funds in the Dubai market, and for them to benefit from the promising opportunities in it.”
Overview
Real estate sales transactions in July 2020 recorded a growth of 3.7% month-on-month, averaging around 600 properties sold in Dubai every seven days. The secondary market exceeded off-plan sales in terms of sales volume, which has been the trend since the end Q2 2020. The Dubai overall Index declined by 0.45%, the Dubai apartment Index declined by 0.69%, and the Dubai villa/townhouse Index declined by 1.63%.
In July 2020, Mo’asher recorded an overall Index value of 1.108 compared to 1.113 in June, with an Index price of AED 1,058,115. Compared to the last six months, July’s Index decreased by 0.36%. However, if we look at the Index for the year, the Index number is still higher than what it was in February and March 2020, and the July index recorded a 10.8% growth compared to January 2012.
The apartments July 2020 Index value was 1.171 compared to 1.179 in June 2020, and the Index price was AED 1,010,882. Compared to the last six months, the Index witnessed a decrease of 0.26%. However, if we look at the Index for the year, the Index number is still higher than what it was in February and March 2020.
The Index value for villa/townhouses for the month of July declined to an Index number of 1.023 compared to 1.04 in June 2020, and the Index price was AED 1,619,298. Compared to the last six months, July’s index decreased by 2.66%.
The most important results
Over the past few months, we noticed an interesting trend whereby the number of transactions in the secondary market is increasing at a significant pace, especially in the villa/townhouse segment. Lynnette Abad, Director of Research and Data at Property Finder, said: “In July, we had 493 sales transactions for ready villa/townhouse properties, which was historically the highest number of transactions in this segment for a single month.”
One of the reasons we are seeing this trend is due to the high demand for larger properties with more outside space. During the lockdown, search and demand data showed that people started looking for bigger properties, shifting from the traditional small family apartments to villa/townhouses. The ‘search and demand’ data revealed that this trend has grown significantly since the lockdown started and continues to have an effect on the market.
The number of transactions has increased significantly since the ease in the lockdown and despite the Eid holidays, the majority of people have chosen to stay in Dubai. In addition, attractive pricing has lured many investors and end-users, and we have seen the number of transactions return to normal levels.
Another significant achievement in the month of July was the value of mortgages, which totalled AED 18.26 billion for 1,153 total transactions. This is 3.09 times more in value compared to June 2020 and 3.36 times more in value compared to July 2019.
