Green shoots emerging for Dubai real estate?

By Eudore R. Chand

Dubai Marina

Dubai Sales Price Index rises 0.79% in Q2

DUBAI 12 August 2020: In the second quarter, Dubai’s official sales price index Mo’asher showed a 0.79% rise compared to Q1 2020 and 15.3% compared to the base year Q1 2012.

The monthly index scored 1.113 in June 2020 compared to 1.121 in May 2020, with an index value of Dh1.06 million.

Dubai Land Department, in cooperation with Property Finder, launched Mo’asher, with base year of 2012 and the base month for the monthly index January 2012, with the base quarter for the quarterly index being Q1 2012.

In June 2020, the overall monthly index recorded 1.113 and an index value of Dh1,066,791. This is a decrease of 0.09% since the beginning of the year and a decrease of 0.7% month-on-month. However, if we look at the quarterly index and compare Q1 and Q2, the index number has increased by 0.8% from 1.144 to 1.153 with an index value of Dh1,072,450.

In June 2020, the monthly apartment index recorded 1.179 and an index value of Dh1,018,974. However, if we look at the quarterly index and compare Q1 and Q2, the index number has increased by +0.58% from 1.206 to 1.213, with an index value of Dh1,026,424.

In June 2020, the monthly villas/townhouses index recorded 1.040 and an index value of Dh1,628,315. This is a decrease of 1.79% since the beginning of the year and a decrease of 1.89% month-on-month. However, if we look at the quarterly index and compare Q1 and Q2, the index number has not changed at all and has stayed at 0.991, with an index value of Dh1,636,095.

Lockdown

These results were achieved despite the fact Dubai was on full lockdown in April, partially in May, and didn’t start opening up fully until June. Hence, the entire Q2 was affected by Covid-19. When it comes to real estate sales transactions, Dubai saw 5,605 sales transactions in Q2 2020 worth Dh11.05 billion. The secondary market saw 40% of the transactions in Q2, while off-plan accounted for 60% of the transactions. In June, the volume of sales transactions was 2,361 worth Dh 4.9 billion and the secondary market, for the first time since the lockdown began, had higher sales transactions than off-plan transactions at the end of Q2.

The data revealed by Mo’asher show the start of the market’s recovery in Q2 2020, and is expected to continue in Q3, albeit at a relatively slow pace at this time of the year. The government initiatives and the stimulus packages they contained remain the primary motive for achieving further recovery and helping the market to continue this trend.

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