Is Sentiment Turning in Dubai Property?

Dubai's property market has been moderating for several years, and prices in many areas are well below their 2014 peak. Yet some buyers see this as an opportunity. Activity among end users is steady, and there is a sense that announcements on residency and preparations for Expo 2020 could improve sentiment.

Reasons for caution

• Supply: a large number of homes are due for completion.
• Prices: still easing in many areas.
• Rents: softening, particularly in new communities.

Reasons for optimism

• Value: prices are attractive compared with previous peaks.
• Expo 2020: construction and preparation are at full speed.
• Policy: discussion of longer residency and business reforms.

Where buyers are active

End users are buying completed villas and apartments in established communities. Investors are looking at off-plan projects with long payment plans.

What would improve sentiment

Clear policy announcements, a slowdown in new launches and steady population growth would help the market find its footing.

Strategy

Buyers can negotiate firmly and choose carefully. Sellers should price realistically.

Sentiment indicators to follow

Sentiment is difficult to measure directly, but several indicators help. The number of viewings per listing and the time properties take to sell show how active buyers are. Attendance at launches and the speed at which new projects sell reveal developer demand. Mortgage approvals indicate how many buyers are financing purchases. Rental renewals and void periods show tenant confidence. Policy announcements and economic data, such as tourism figures and employment growth, influence the mood among investors. No single indicator tells the whole story, but tracking several together over a few months gives a reliable sense of whether sentiment is improving, stable or deteriorating.

Our view

Sentiment is mixed, but the market offers value for patient buyers. We help clients act on opportunities while managing the risks of a soft market.