With AED259 bn in real estate transactions in 2016, Dubai market set to gain further momentum in 2017, DLD chief

DUBAI, Total amount of real estate transactions recorded in the Emirate last year exceeded AED259 billion, revealed Dubai Land Department’s (DLD) annual report.

Commenting on DLD’s annual report, Sultan Butti bin Merjen, Director-General of DLD, said the findings in the report confirm that the real estate market in Dubai has reached a new phase of maturity and stability, and that it is moving towards sustainable growth.

Bin Mejren predicts that the real estate market in Dubai will gain further momentum in 2017, signaling an upward trend for sustained growth in the run-up to Expo 2020. The news was shared in his comment on the annual report, which was issued by Real Estate Research and Studies Department at DLD.

The DLD annual report which includes a detailed insight into Dubai’s real estate scene, the infrastructure of mega-projects, and preparations for Expo 2020 also reveals that the real estate market is expected to benefit from a new wave of activity and growth this year.

Developers have risen to meet the challenge of this new growth phase, with the launch of new projects valued at over AED100 bn, as well as the completion of mega-projects and the development of new services to meet growing demands from a variety of real estate sectors.

DLD’s annual report also reveals that the Emirate recorded a total of 60,595 real estate transactions in 2016, exceeding AED259 bn in value. Over 41,776 sales transactions took place, representing a total value of AED103 bn, while the 15,000 mortgage transactions were equivalent to a value of AED128 bn.

In 2016, land sales and mortgage transactions represented a total value of AED193 bn across 15,994 transactions. This breaks down to mortgages bringing in over AED114 bn via 5,145 transactions, while sales secured over AED55 bn from 9,892 transactions. In terms of value, commercial land (already built on) claimed the lion’s share, representing 30 percent of the total value secured by transactions in 2016.

Segmenting sales and mortgage transactions by buildings and units, DLD’s report finds that over 44,602 transactions took place, representing a total value of AED66 bn. Building sales recorded 2,626 transactions worth AED 7 billion, while units performed 29,258 transactions worth AED51 bn. In addition, the report records 1,391 building mortgage transactions worth AED3.4 bn, and 8,000 unit mortgage transactions valued at AED10.5 bn.

Dubai’s real estate sector continued to attract a wealth of investors in 2016; DLD reports that the sum of real estate investment transactions for the year exceeded AED91 bn from 55,928 investors. As has been the case in previous years, the leading investors were UAE nationals from across the GCC, Arabs, and foreigners, for their investment of nearly AED22 bn from over 7,000 investors.

In 2016, citizens of the Gulf Cooperation Council (GCC) states contributed AED35 bn from 12,768 investors of six nationalities, while 3,294 Saudi Arabian investors made transactions worth AED8 bn.

Investors from Qatar and Kuwait approached AED2 bn mark, from 1,006 and 770 investors respectively, followed by nationals from Oman (301 investors) and Bahrain (244 investors), who contributed up to AED1 bn.

Arab investors from outside the GCC contributed over AED12 bn to the real estate market last year, from 6,416 investors of 16 nationalities. DLD’s report reveals that among these, Egypt ranked highest in number of investors, with 1,364 investors making transactions worth over AED2.4 bn. Other leaders in numbers of investors were Algeria, Iraq, Lebanon, Palestine, Sudan, Yemen, and other Arab countries, while citizens of Jordan ranked highest in terms of value, investing a total of AED2.5 bn across 1,331 investors.

2016 saw foreign investment in the Dubai real estate market approaching AED44 bn, from 22,834 investors of 136 nationalities. Indian nationals rank highest in terms of both volume and value, making AED12 bn worth of property transactions across 6,263 investors. Pakistan contributed AED4.4 bn worth of property transactions across 3,372 investors, while British investment totaled AED5.8 bn from 3,372 investors. The report also details the activity of investors from Canada, China, France, Iran, Russia and the United States, who are among the most prominent foreign investors in Dubai’s real estate market.

DLD’s report identifies Dubai’s top five sales areas for 2016, revealing that the Business Bay area benefited from a high level of interest 3,508 investments worth AED6.2 bn followed by Dubai Marina, Jebel Ali 1, Burj Khalifa and Warsan 1.

Studying the same list in terms of value alone, the Burj Khalifa area stands out as superior to others, having secured over AED7 bn across 2,097 transactions. Following closely behind, the Dubai Marina area recorded 2,937 transactions worth AED6.3 bn. Business Bay secured third place, followed by Jebel Ali 1 and Warsan 1.

Dubai’s Seeh Shuaib emerged as the most attractive area for investors in 2016, with the value of its land sales transactions reaching AED3 bn across 1,684 transactions. It was followed by Al Yafra 3, Al Yafra 2, Al Hebeya 3 and Sheikh Mohammed Bin Rashid Gardens.

With regards to building sales, Sheikh Mohammed Bin Rashid Gardens was the most prominent area in 2016, attracting a total of 699 transactions valued at AED1.8 bn. Al Yalayis 1, Al Thunaya 4, Al Yalayis 2, and Nad Al Sheba 1 were the next most active areas for building sales.

With regards to individual unit sales, Business Bay took first place with 3,491 transactions valued at AED5.1 bn, followed by Dubai Marina with 2,923 transactions exceeding AED6 bn. Jabal Ali 1, Burj Khalifa and Warsan 1 were the next most active areas for unit sales.

The highest number of land mortgage transactions was recorded in Al Thunaya 5, which secured 352 mortgage transactions representing a total value of AED2.274 bn. It was followed by Al Hibeya 3, which recorded 340 mortgage transactions at a total value of AED1.002 bn, and Wadi Al Safa 6, where 261 mortgage transactions amounted to a total value of AED865 mn.

In terms of buildings, Al Thunaya 4 came on top in terms of mortgage transactions, with 350 mortgage transactions amounting to AED 623 million, followed by Al Yalayis 1, which recorded 280 mortgage transactions at a total value of AED362 mn. Wadi Al Safa 6 came in third place, with 170 mortgage transactions amounting to AED363 mn.

Dubai Marina secured the highest number of mortgage transactions for individual units, with 1,107mortgage transactions amounting AED1.721 bn. It was followed by Thunaya 5, where 953 mortgage transactions totaled AED1.258 bn, with Business Bay following in third place with 783 mortgage transactions representing a total value of AED1.154 bn.

DLD’s data released by Developers Registration also indicates the entry of 55 new developers into the real estate market, with the launch of 134 new projects worth over AED100 bn, and the completion of a further 62 projects in 2016. The data also reveals that in 2016, DLD recorded over 410,000 lease contracts from different groups across Dubai.

DLD issued 695 licenses over the course of 2016, and the report details that the activity of Brokerage in the sale of real estate and leasing came in first with 272 licenses, with the activity of Brokerage in real estate rental coming in a close second at 223 licenses.

There has been demand for other categories of licenses in the field of real estate, most notably real estate development, the interim real estate development, property valuation services, rental services and property management to third parties, the purchase of land and properties, mortgage brokers and many others.

The report also records that the number of brokers has increased to 5,933 over the past year, and that 2,285 brokers’ offices were active in 2016.

Source: Emirates News Agency