DUBAI: The Year 2014 is going to be a great year for the housing sector in Dubai. This follows reports that at least 30, 000 new housing units are set to join the inventory of fresh housing stock this year. The details of the massive new housing inventory have been outlined in the latest report of analysts Jones Lang LaSalle. The new development is expected to ease the pressures on housing demand as boost supply side.
This beats the record of 2013, where only some 10, 000 units were added to the housing stock. The new additions were mostly outside Central Dubai in Whispering Pines villas, Cappadocia residences, Dana Tower and City Oasis in addition villas in Dubai Sports City.
In the new inventory for 2014, Dubailand accounts for 33 per cent of the announced future supply. The break up is like this
- Dubailand (16,000 residential units)
- Dubai Marina (4,200 units)
- Dubai Sports City (3,700 units)
- IMPZ (3,000 units)
- Business Bay (2,700 units)
- Dubai Silicon Oasis (2,600 units)
Apartments Sales Up
According to the report, JLL expects rents and prices to increase in 2014 but the growth rate will be less than the levels witnessed during 2013. In 2013, the residential sector had seen rising prices and rents. The boost came from the hosting of Dubai’s Expo 2020.
The Reidin sale index recorded a 22 per cent year-on-year (y-o-y) growth in November 2013 with apartments having outperformed the villa sector, which had a 15 percent jump in prices.
Maximum price hikes were recorded in Palm Jumeirah, International City and Jumeirah Lakes Towers. In leasing, the Reidin Rent Index was up by 17 percent on annual basis with apartments outperforming villas.
So, there is hope in the property market that the upcoming new inventory will benefit the tenants in a big way as they have more choice to select new properties to rent in Dubai.
Dubai’s business sentiments have got a shot in the arm from the proposed hosting of Expo 2020 opportunity and that optimism is percolating to the real estate sector in a big way. But experts warn that an over shot of these sentiments can cause rents and prices to flare up to unsustainable levels and may lead to the bubble in 2008. Disturbing trends like return of speculators and dominance of cash buyers are viewed with concern as it may do much harm in the long run.