Golden Visas And Luxury Residences Are Boosting Dubai Off-Plan Property Sales, And More Are On The Way.
The Dubai property market is currently experiencing a surge in off-plan sales. Developers offer discounts of up to 5-10% on down payments, along with a complete waiver of registration fees and other charges. Some projects even allow buyers to make down payments as low as 1% or a fixed amount of Dh50000 to secure their property purchase. Rather than focusing on post-handover payment plans spanning over 3-5 years. Investors are now more concerned about the size of their initial payment.
The Dubai property market is also witnessing a surge in demand for the Golden Visa program. Which requires a minimum investment of Dh2 million in real estate. According to market sources, this program has become a significant driver for attracting first-time foreign investors to purchase properties in Dubai.
Furthermore, the luxury segment of the Dubai property market is experiencing an all-time high in demand, with buyers increasingly turning towards new, super-premium off-plan projects. Due to the limited availability of similar ready-made properties for sale.
Will The Rush For Off-Plan Properties Persist?
The Dubai real estate market has demonstrated these trends in the first quarter of 2023. Along with a remarkable 50 percent surge in sales compared to Q1-2022. According to DXBInteract.com data, nearly 31,000 residential properties were sold, marking the best performance in the past ten years. This is primarily attributed to two factors: the sustained demand for luxury homes and the growing number of takers for the Golden Visa program, as stated by Firas Al Msaddi, CEO of FAM Properties. In the first quarter of 2023, FAM Properties sold seven Bulgari-branded homes, amounting to Dh690 million in sales.
The property investment limit for the 10-year visa was reduced from Dh10 million to Dh2 million in 2022. Immediately expanding the potential pool of property buyers. This change was particularly appealing to those planning to relocate to the UAE. Who may have previously considered starting a business in the country but not purchasing the property. As noted by the head of a business consultancy, the revised Golden Visa program is now affordable for a wider range of buyers.
Aldar’s Success Story Is Set To Make Its Way to Dubai Soon
Dubai developers remain optimistic about the continuing success of the property boom. With the first quarter of 2023 witnessed a surge in off-plan launches, the highest since 2017-18. Developers cite the confirmed sales backlog of prominent real estate companies. Such as Emaar, Damac, Sobha Realty in Dubai, Aldar in Abu Dhabi, and Arada in Sharjah as evidence that the boom is here to stay. As one mid-sized developer’s CEO pointed out, the looming presence of Aldar. Its plans for three mega-communities in the coming months are the big elephant in the Dubai off-plan market. The soon-to-relaunch projects from Nakheel will further increase the competition for off-plan sales, he added. Emphasizing the need to launch projects now instead of later to stay ahead of the competition.
While the luxury property market in Dubai offers limited incentives. Sales of $10 million homes in the first quarter of 2023 performed well, setting the stage for a possible record-breaking year-end tally. However, in the lower price ranges, the market is witnessing an increase in buyer incentives. Particularly in reducing the down payment to as low as 5 percent. Some offer even feature a down payment of only 1 percent of the property value or just a token amount of Dh50000. According to an analyst, down payment requirements are becoming a potential hurdle for buyers. Due to higher mortgage rates, inflation expenses, and other factors.
Dubai developers are now prioritizing reducing the burden on initial payments to ease the way for first-time investors and end-users. Instead of emphasizing longer post-handover payment plans. With the sales boom showing no signs of slowing down, early April data from the Dubai Land Department indicates a bullish trend that justifies developers’ efforts to make the point of entry for buyers as easy as possible. As long as the boom continues into the second quarter, developers will likely do everything in their power to keep it going.