25 February 2016

The Theory of the Leisure Class: A Look into Emirates Hills

Emirates Hills consists of 622 villas, spread over 10 sectors. A granular analysis by sector of listed prices reveals that Sector R has the highest price per square foot rate followed by W and V while Sector E and P, account for nearly 1/3rd of the entire supply.

Since the launch of Emirates Hills plots prices have increased more than 10 fold, outperforming any other real-estate asset in Dubai. A min-max analysis of transacted villa prices in Emirates Hills reveals the gap has doubled in the last 6 years.

The widening of the gap is a function of the large differences in the underlying properties that have been constructed in this community over the years.

A transactional activity analysis of the community over the last 5 years reveals that cash transactions accounted for 80% of activity. However, in the last 18 months, there has been a spike in ‘other transactions’ (which include refinances), which have coincided with the crash of oil prices. Due to the liquidity crunch prevalent in the market, it is likely that this trend will continue to grow as homeowners seek to monetize the substantial home equity built in their villas.

To download the full report click here: http://blog.reidin.com/PublicReports/UAE160226.pdf