The second half of this year will continue to see the trend of tenants turning into homeowners in Dubai and it is expected to continue even in 2024.
This is despite the fact that there is a slowdown in rental increases, but expatriates have also started to adopt a long-term perspective where the emirate is concerned.
As a matter of fact, it has showns steady growth, as it gives the confidence that many people are looking for.
But, this has also instilled FOMO (fear of missing out) in some people about missing the upside, or being completely priced out.
This is encouraging for new homeowners, who want to take advantage of the increase in rental rates and leverage capital appreciation as well.
Real estate industry players believe that there will be a steady increase in Dubai’s property prices, but the pace is expected to slow down, especially in the high-end market.
Projections show that in 2024, the residential property in Dubai will become the fastest growing and this would make it an attractive option for tenants to become homeowners.
Knight Frank revealed that in 12 months, there had been a 48.8% increase in the property prices in Dubai, while six months saw a 19% increase and the second quarter of the year saw 11.6% growth.
Asteco’s CEO, HP Aengaar, said that a long-term perspective had been adopted by expatriate residents in recent years.
Initially, there had been emphasis on medium and short-term stays, but this has transitioned into a medium to long-term outlook.
The introduction of retirement visas has accelerated this particular trend. Not only does a growing economy improve liquidity, but it also gives people job assurance and stability.
This is what people are looking for before they decide to become homeowners. Even as there is a slowdown in the pace of rental increases, homeownership seems to be a long-term investment and saving option.
The CEO added that this approach suits people better where savings are concerned. Furthermore, the Dubai Land Department (DLD) has also introduced policies and mortgages.
These are aimed at ensuring transparency and protecting investor rights, which simplify the process of purchasing property in Dubai.
The head of research for North Africa and the Middle East, Taimur Khan, said that by the year end, the rate of price increase will taper, but it will stay positive.
Khan stated that the rental market segment was already experiencing this and they expected it to continue.
Anegaarsaid that one of the biggest benefits for tenants who are becoming homeowners is the ability of customizing the space in accordance with their personal preferences.
This enables them to create something that reflects their needs and style. In addition, fixed mortgage rates also offer them stability, as compared to rental fluctuations.
Furthermore, owning property usually results in capital appreciation over time, which makes it a great way of building equity.