Dubai real estate’s mid-tier is where the action is starting to hot up ... and it is happening on prices, locations, and in buyer support.
Based on the year-to-September transaction data in Dubai, properties that can be classified as mid-market accounted for more than 70 pert cent of the deals, and the rest made up of upscale and super-premium. This would represent the best ever percentage levels recorded by the mid-market, more so as property sales in Dubai have historically weighed heavily in favour of premium offerings. In fact, last year, the split averaged around 70:30 in favour of the premium over the mid-tier. And even during the first half of this year, the split was running nearly equal.
“The market’s clearly starting to see the presence of a younger buyer who is more comfortable putting aside Dh500,000 and more on a one-bedroom apartment than spend Dh2 million,” said Talal Al Gaddah, CEO of MAG Property Development, which is now working on the final details before the release of a further set of units at its MAG 5 Boulevard project in Dubai South.
“You are seeing versions of this trend everywhere — in hospitality, the global average room rates at five-star properties are now around $180 against the $400-$500 in 2013. Everything’s changing.
“The younger buyer believes spending on a lifestyle is more important than committing a large percentage of their income on their property instalments. It’s these buyers that, increasingly, Dubai’s developers will have to go for. For the next 5-10 years, you will see a lot happening around the Dh600-Dh900 a square foot pricing levels.”
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