DUBAI 15 April 2019: A rise in buyer and tenant registration against a backdrop continued reports of oversupply in the Dubai property market, has been reported for the first quarter.
Buyer registration is up 20% with sales transactions experiencing an 18% increase. Tenant registration is up considerably at 55% with rental transactions seeing an extensive 75% increase,” according to Allsopp & Allsopp.
The population of Dubai is continuing to grow, according to the Dubai Statistics Center the city has seen a 6.5% rise since March 2018 putting the population up to 3.1 million. This rise in population is slowly but surely matching the property supply as is indicated by the rise in buyer and tenant registrations.
Lewis Allsopp, CEO explains “We have heard oversupply as far back as 2006 in regard to the Dubai property market when the Jumeirah Beach Residence units were handed over. These apartments were, of course filled quickly and Dubai went on to build hundreds of thousands of more units, which, in time have filled. As long as the population continues to increase, demand will come.
“More buyer and tenant registrations reflect more confidence in the Dubai property market and Dubai as a whole. People are moving to Dubai to better their career in a city which offers the opportunity to do so. These tenants are then joining the Dubai property cycle. For those who decide that Dubai is the place for them, typically in 3-4 years these tenants will look to make a step onto the Dubai property ladder. This is exactly what we are seeing with the increase in buyer registrations. Tenants are taking advantage of the drop-in pricing that has taken place over the last couple of years in the city and buying their first homes,” he added.
The average age of Allsopp & Allsopp’s tenants and buyers fall between 31-45 years old and this has remained consistent throughout the years. However, the company’s statistics for Q1 have revealed an increase in 18-30-year old’s buying and renting property within Dubai.
Allsopp says “The increase in millennials buying and renting in Dubai is very positive for the city. Millennials are known for being more care-free and of the renting generation with less importance being put on buying a home. The fact that we are seeing an increase from 14% of tenants that are between the ages of 18-30 in 2018 to 16% in Q1 2019 and from 12% OF 18-30 buyers in Q1 2018 to 15% of the same age in Q1 2019 is emphasis on the health of Dubai as a whole.”
Finance buyers increased from 53% in Q1 of 2018 compared to 62% in Q1 of 2019 and secondary market sales have also increased by 21%. The majority of mortgage bought properties through the company are sold to end user buyers, typically families or young couples looking to settle in Dubai.
The growing real estate company reports a trend of more tenants paying in multiple cheques and a decline in company’s paying employees rent in only 1 cheque.
Lewis Allsopp explains “Gone are the days of companies paying for their employee’s rent in one cheque. As a matter of fact, 73% of Allsopp & Allsopp rental transactions were paid in multiple cheques. We have also seen a decrease from 7% of company rented properties in Q1 of 2018 to 4% in Q1 in 2019.”