Downtown Dubai: Is Value Starting to Recover?

More than a year after Burj Khalifa opened, Downtown Dubai has become the busiest part of the city. The Dubai Mall attracts millions of visitors, the fountain draws crowds every evening and the boulevard's restaurants are full. In the property market, Downtown has been among the first districts to show stabilising prices and firm rental demand.

What is supporting Downtown

• Completed amenities: the tower, mall, opera plans and boulevard are in place or in progress.
• Prestige: a global address that attracts residents and visitors.
• Tourism: strong demand for short stays and hotel apartments.
• Location: close to DIFC and Business Bay.

Rents

Apartments with views of the tower or fountain are in demand from professionals and couples. Rents for these units have held firmer than in many other districts.

Sales

Buyers, many paying cash, are showing interest in completed Downtown apartments. Prices remain below their peak, but the gap between asking and achieved prices is narrowing in the most desirable buildings.

Differences between buildings

Downtown's buildings vary in age, quality, service charges and views. Units with permanent views and good management are performing best.

Risks

New supply continues to be planned in and around Downtown, and the broader market remains fragile. Buyers should avoid assuming rapid price growth.

Short-term rentals in Downtown

Downtown's popularity with visitors has created demand for furnished apartments let by the night or week. Holiday letting can produce higher gross income than an annual lease, especially for units with views of the tower and fountain. It also involves more work and higher costs: furnishing, cleaning, guest communication, utilities and management fees, as well as periods without bookings. Building rules may restrict short stays, and owners should confirm what is permitted before committing. For owners who live abroad, a reputable operator is essential. Comparing expected net income from holiday letting with a conventional annual tenancy, using realistic occupancy, is the best way to decide which approach suits a particular apartment and its owner.

Our view

Downtown is one of the strongest districts in Dubai today. For buyers with a long-term horizon, well-chosen apartments in the area offer quality, demand and the potential for gradual recovery in value.