Fuel Dubai's prosperous "Lockdown Dodgers"

[Compass Real Estate Platform] The property market in Dubai is being driven out of six years of lethargy as "lockdown dodgers," and rich foreign investors are driving the purchases frenzy that records are shattering and driving economic resurgence. Hottest on the market, luxury villas are the European customers looking for houses on PalmJumeirah Island and golf course estates in particular.

In the aftermath of Covid's 19 struck the Dubai property market in rolling coasters, which had steadily declined since 2014, shut down the borders of the Emirates, Zhann Zochinke, the Chairman of the Operations Consulting Office Property Monitor, stated.

“Then straight after that lockdown period we started to see transaction volumes increase, and they really haven’t stopped since,” he told AFP. “We’re now seeing record month-on-month gains and transaction volumes.”

The emirate in the Gulf was one of the first guests to reopen in July last year, combining open-door policy with rigorous laws on masking and social dissociation, and an active vaccination drive producing some of the world's highest rates of inoculation.

Despite an increase in new year coronavirus cases, when vacationers dropped massively, life has proceeded as usual, with open hotels and restaurants and minimal limitations that have plagued other places.

"The other countries lockdown dodgers? I think we see a lot of this," Zochinke said, adding that other pulls included more eased residence regulations and a decision to allow companies to be fully owned by foreigners.

According to IHS Markit, the flow of arrivals has rejuvenated the tourist industry for a long time, which is a major economic area of Dubai, which has little of the petroleum wealth which fuels its neighbors.

"Research business economist David Owen said: travel and tourist companies have achieved the most remarkable performance rebound, as the growth in tourism activities is hoped for later this year, backed by the speedy vaccine roll-outs.

The spike of luxury houses above 10 million dirhams ($2.7 million) has been noticeable since house owners saw their capital drain for several years, with 90 transactions in April compared to roughly 350–400, according to Property Monitor, on a typical annual basis. 

For 111,25 million dirhams, the highest price in years in a palm home with 16 fronds lined with show-stopping residences and supercars sitting on the driveways has been sold for 111,25 million dirham. A large new Italian mansion located at the end of one of the thorns is the highest price today on this block with a 180° front of the beach offered in the order of 100 million dirhams.

After languishing on the market during the peak of the pandemic during the dreary days, developers hope that the infinitely large pool, the private movie theater, and acres of marble and glass will tent one of the new races of cash-up Europeans.

"I think that people have come to know that Dubai is no longer just a building site, where we had perhaps the most number of cranes in the world ten years ago," said Matthew Bate, CEO of the Black Brick, one of the property's agencies.

"Now people look at Dubai and say - this will be my primary home. I'll be able to work from Dubai and still operate in Europe, North America or Asia," he remarked. "So I think it opened our doors to the rest of the globe, what Covid eventually did." There is anxiety about whether the recent euphoric increase can continue in a market where a lot of fortunes have been made and lost.

According to Property Monitor, sales of properties above ten million dirhams were 6.7 percent higher in April than in the preceding month, and 81 villas sold on the Palms alone in April, up from 54 in all 2020.

The market is still at its peak in 2014 and the market for apartments remains far behind, even with the impressive improvements. However, in a recent research the financial services company Morgan Stanley said that the event is unlikely to stop soon.

"Solid demand, peak supply growth and extended lead times for new projects could in the next several years lead to a tighter than projected market," he said. "Over the previous 12 months, a surge of government reforms, competitive mortgage rates and a change in demand patterns owing to the Covid19 have all been credited."

Author ៖ Samnang, Editor-in-Chief ៖ Sunnie, Editor-in-Chief / Producer ៖ Nicole

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