We did tell you that now ‘is’ the right time to invest in Dubai. The real-estate market is upbeat after a long time and Dubai is looking up after a more or less flat market of 2015. Investors are back to Dubai, government initiatives are ensuring that the supporting facilities of the ‘best infrastructure’ which includes smart transportation, best-in-class roads are being made available and accessible and as a result, there are once again interesting ‘projects’ being launched.
Now, a report released by a real estate consultancy, says in its latest Dubai market forecast that townhouses will be the flavour of the season for premium home buyers. So, if you are looking for a company setup in Dubai or a Dubai Freezone company setup, and are looking for a place to settle down, then opt for townhouses for your family.
Let’s check out the trends and reasons behind it.
The forecast claims that a massive supply or oversupply of apartments and villas is likely to bring down the rents in 2016. Close to 22,000 apartments and 7,700 villas will be delivered this year compared to 13,500 apartments and 800 villas that were added to the residential pool of Dubai in 2015.
The figures for the supply completed in 2015 for villas and townhouses was 800 and the supply expected in 2016 figures are forecasted to be 7,700. These figures speak their own story.
In 2015, the developers concentrated on affordable homes, which filled a huge gap in the market. The truth, however, was that most affordable homes were overpriced as far as the majority of Dubai’s residents were concerned. The end, result was that these homes ‘had to be’ bought by investors.
Experts are predicting that the outlook for 2016 will be more positive than what ‘was’ in 2015 and will extend to all segments of the real estate sector. Residential sales across the board recorded a sharp decline in 2015, with the villa sales prices down year on year by 11 percent and apartments by close to 8 percent. That’s a huge drop even by the trends in the residential space sector. The demand for projects is likely to grow with the progress and completion of key infrastructure projects such as the Dubai World Central airport and Expo 2020.
Combine the above information with the completion figures for the villas and townhouses in 2016, and the picture becomes crystal clear. Consumers and end-users will be the predominant buyers for villas and townhouses rather than investors. The data forecast revealed that the buyer likes were for two, three and four bedroom units as compared to large villas.
With a fresh supply of apartment blocks and units in the market, ‘older apartment’ owners are being forced to compete on prices. Even the bigger villa sizes are going for less since there are more modern villas on offer with better amenities, and at much lesser prices.
The demand for villas and townhouses is high which is understandable. Everyone likes living in a spacious villa or townhouse compared to an apartment that is less spacious. And, Dubai offers the best-in-class villas and townhouses at reasonable rentals and buy-in prices. So, why not? As the data clearly shows, the preference from the high-end buyers is for townhouses which are 2-3 bedrooms only and not really the 5-6 bedroom ones – which in effect mean a lesser price to be shelled out.
No wonder then, that the townhouses will be the toast of the season for the high-end premium home buyers for Dubai in 2016!
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