Expo 2020 Dubai generates property demand as tourists flock to visit the world’s largest trade fair
According to a recent report by Zoom Property Insights, the Dubai rental market is expected to sustain an upward trend in the near-term future, particularly in areas with close proximity to the Expo 2020 event. The report noted that the real estate sector in Dubai has already seen a surge in rental prices during the third quarter of the year, with affordable housing rentals increasing by around 14 percent and luxury housing rentals surging by up to 30 percent in selected areas of the emirate.
The report further highlights that the rental market is likely to continue to witness an upward trend in the fourth quarter, primarily driven by the commencement of Expo 2020 Dubai. With the event attracting millions of visitors from around the world, there is a significant demand for rental properties in areas close to the Expo site, which is expected to drive up rental prices in the short-term.
Overall, the report suggests that the rental market in Dubai is likely to remain buoyant in the coming months, with investors and developers capitalizing on the opportunity to generate significant returns on their property investments.
The first 10 days of the marquee event recorded 411,768 visitors, and it is expected to welcome up to 25 million visitors from different countries throughout its six-month run. From these figures, it can be ascertained that the areas located close to the event site will remain busy during this world fair. There is an expected growth both in terms of rental prices and demand in these areas.
Ata Shobeiry, CEO at Zoom Property, said the promising statistics in second and third quarters of 2021 paved the way for a strong fourth quarter.
“Due to the ongoing Expo and a strong comeback by the Dubai property market post-pandemic setback, rental prices will see a significant increase in the last quarter,” Shobeiry said.
The Q3 reports from various property portals on the Dubai real estate market suggest that there was heightened activity in affordable flat rentals in areas such as Jumeirah Village Circle (JVC), Al Nahda, Bur Dubai, Dubai Silicon Oasis, and Deira. On the other hand, tenants seeking luxury apartments preferred areas such as Dubai Marina, Downtown Dubai, Jumeirah Beach Residence (JBR), Palm Jumeirah, and City Walk.
According to reports from various property portals, Mirdif, Damac Hills 2, JVC, Reem, and Dubai South were the top choices for tenants seeking affordable rental villas. For luxury villas, Jumeirah, Al Barsha, Umm Suqeim, Arabian Ranches, and Dubai Hills Estate remained the most preferred options. These areas are expected to continue leading in the rental market during the October-December quarter as well, as per Zoom Property Insights.
While experts predict a rental recovery in Dubai in the coming months and 2022, they note that the recovery is likely to be segmented. The villa districts and prime apartment locations are expected to see a faster pace of recovery, while most affordable and outer apartment districts are expected to see slower stabilization rates. Edward Macura, a partner at real estate consultancy Core, explained that most rental increases are in the new-let market, and there haven’t been similar levels of rental escalations in lease renewals due to the cap on rental increases regulated by the Rera Rental Index.
Shailesh Dash, a Dubai-based financier and entrepreneur, stated that Dubai’s economy and real estate sector have been in an upswing since early this year, particularly with the build-up to Expo 2020. Dash added that creating a more investor-friendly environment will help the economy even beyond the Expo. Atik Munshi, managing partner at FinExpertiza UAE, noted that real estate prices in Dubai and other UAE emirates have steadily increased, particularly for high-end property, over the last year and a half.
“This trend is expected to percolate to mid-range and affordable properties too. With increase in property prices, the rentals thereof would also witness increase,” he said.
According to a report, the rental market in Dubai is expected to continue its upward trend in the near future, especially in areas close to the Expo 2020 event. The top areas for affordable rental villas are Mirdif, Damac Hills 2, JVC, Reem and Dubai South, while Jumeirah, Al Barsha, Umm Suqeim, Arabian Ranches and Dubai Hills Estate are the top picks for luxury villas. Rental recovery is expected to be segmented, with villa districts and prime apartment locations expected to see a faster pace of recovery compared to affordable and outer apartment districts with ample existing stock. The Dubai REST app from the Dubai government is a simple way to check if rental prices have increased in any area in Dubai. With the UAE economy showing positive growth and Expo 2020 attracting a large number of people, the demand for housing is expected to increase, pushing rentals higher. The recent golden visa scheme and 100% business ownership policies have resulted in increased entrepreneurial and investment activities, reflecting in the rental property market’s demand and prices. Property sales are also expected to increase in Q4, with the best ever third quarter transaction value of Dh42.35 billion.