14 April 2017
Dubai: Reality is not What It Seems
After a decline being witnessed in the last 3 years, there has been resurgence in transactional activity in the first quarter of 2017, confounding sceptics that had called for a continued decline in volumes. According to the land department, the first quarter of 2017 recorded property transactions worth DHS 77 Billion. There has been an uptick of 25% in activity compared to the same quarter last year. A recent criticism suggested that the reason why activity is on the rise is due to the registration of previous sales.
A price analysis of various communities reveals that the majority have experienced growth since their trough. Springs and Meadows have experienced the highest growth of approximately 6%, coinciding with its increased volumes. On the other side of the spectrum International City continues to test new lows. This corresponds to the lower transactional activity witnessed in this community.
A peak into the residential sales of off-plan transactions shows there has been a 100% increase of recorded sales between the first quarter of 2017 and last year. This increase testifies not only to the resurgence in investor activity that has been registered, but also repudiates the claim that the surge in transactional activity is on account for registrations.
The zeitgeist remains predominantly negative, despite continuing stability in prices, and a sustained increase in transactions. Whilst there remain concerns that are valid, it is curious to note that in this cycle, analysts remain predominantly ignorant of the positive influences that the market seems to be reacting to.