Trying to find out how to invest in Dubai real estate but not sure where to start? With so many options, it’s far more difficult to discern which regions offer remarkable potential returns. The top off-the-plan investment areas in Dubai, make it less complicated for investors to make informed choices. This article highlights these best places and offers insight into the modern trends and prospects of Dubai’s off-plan market.
Top Off-Plan Investment Areas Revealed By Property Experts
The Dubai real estate sector saw a significant increase in off-plan market sales during the second quarter of 2024. Off-plan transactions made up 63 percent of total property sales, showing a strong demand for new developments. Despite only a five percent growth in the number of launched units, transactions soared by 212 percent year-on-year. This highlights the popularity and potential profitability of off-plan investments in Dubai.
Jumeirah Village Circle
Jumeirah Village Circle (JVC) remains a top hotspot for off-plan investments. It ranked first for the number of transactions for the fourth consecutive quarter. In Q2 2024, JVC recorded 3,102 transactions, totaling $805 million (AED 2.95 billion) in sales value. The family-friendly neighborhood saw price per square foot increase by five to 12 percent compared to the same period last year. District 10 in JVC emerged as the top off-plan investment opportunity, offering apartments priced between AED 250,000 and AED 2.6 million.
Although property prices in JVC have more than doubled in recent years, the neighborhood is set to receive approximately 30,000 new residential units, which is 80 percent of its current housing stock. This increase in stock could balance the area’s market dynamics.
Muhammad Bin Rashid City
The exclusive district of Muhammad Bin Rashid City (MBR City) reported 1,998 transactions, totaling $664 million (AED 2.4 billion) in Q2 2024, marking significant growth compared to the previous year. MBR City is expected to deliver 19,845 units by 2028. During the second quarter of 2024, neighborhoods like Sobha Hartland and Dubai Hills Estate showed a steady rise in sales price per square foot.
One and two-bedroom homes accounted for the highest number of transactions in these areas, with average prices increasing by 15 and 17 percent respectively. Districts One, 11, and 7 continue to offer strong off-plan opportunities, with an average return on investment ranging between 7.45 percent and 48.9 percent.
Also Read: Dubai Real Estate Property Market Shows Continued Growth In June
Business Bay And Dubai South
Business Bay, known for its high demand and rising prices, recorded 1,863 transactions with a total sales value of $1.4 billion (AED 4.8 billion). Average gross investment yields remained strong at 7.8 percent, holding steady for the past 12 months. Among the top-performing off-plan projects in Business Bay are those that attract significant interest from luxury buyers. The affluent community is set to see around 20,000 new residential units in the coming years.
Dubai South has become a popular hotspot due to the recent announcement of the Al Maktoum International Airport expansion plans. Last quarter, the area launched several new townhouse and villa communities, leading to a 75 percent growth in townhouse sales and a 360 percent growth in villa sales year-on-year. Despite this, apartment sales still dominated with 91 percent of sales. In the coming years, Dubai South will have an additional 14,000 new residential units added.
Off-Plan Future Outlook
Dubai’s off-plan market is witnessing significant growth, with over 52,000 units expected to be completed this year and 78,361 new units launched so far. With 297,000 residential units currently under construction, the market shows no signs of slowing down. However, despite the positive growth, some property experts have raised concerns about the impact of the influx of new units on market dynamics and residential property prices over the medium term.
The latest Q2 2024 Dubai Residential real estate market report indicated that the median off-plan sales price was $419,000 (AED 1.54 million), representing a 0.6 percent decline from Q1 and the second consecutive quarter decline. The report also highlighted that individual sellers in off-plan projects are struggling to sell at opening prices, with many opting to take a loss instead of paying the next developer payment they cannot afford.
Despite these challenges, there is still healthy demand among investors for off-plan properties. Earlier this year, a significant 76.3 percent year-on-year increase in off-plan residential registrations was recorded, indicating investor confidence in the market’s long-term potential.
Arshad Darbar’s Thoughts
Arshad Darbar, a seasoned real estate expert with several years in the market, shared his insights on the latest news in Dubai’s off-plan investment sector. He highlighted the remarkable growth in off-plan transactions, emphasizing that the 212 percent year-on-year increase reflects robust investor confidence in Dubai’s real estate market. Darbar pointed out that areas like Jumeirah Village Circle and Muhammad Bin Rashid City are particularly attractive due to their significant transaction volumes and promising returns.
According to Darbar, the key to successful investment lies in thorough research and understanding of market trends, ensuring that investors make informed decisions to maximize their returns. His expert opinion underscores the importance of staying updated with market insights and being strategic in investment choices.
Conclusion
The Dubai real estate market offers numerous opportunities for off-plan investments. Areas like Jumeirah Village Circle, Muhammad Bin Rashid City, Business Bay, and Dubai South are leading the way with significant transactions and promising returns. Despite some concerns about the influx of new units, the market remains strong, with a healthy demand for off-plan properties.
For investors looking to capitalize on Dubai’s real estate boom, these top-performing areas provide a great starting point. By staying informed about market trends and potential growth areas, you can make smart investment decisions that yield profitable returns.
