On this week’s episode of Taking Care of Business, join Operations Director; Paul Kelly and Managing Director; Marc Walters as they sit down to discuss the highlights from April’s real estate activity, the undersupply of commercial properties - and we ask, why is Marc Walters’ head blown away?
To begin with, Marc Walters is shocked that a four-bedroom apartment has been sold for a record-breaking AED 160 million in The Burj Khalifa. He believes this could be the most expensive apartment sold per square foot and has got to have a terrace part of it - but sources are checking! So, we’ll keep you posted…
Next up, it's time to break down the April report - for the first time since last June 2022, the market has seen a dip. What are the red areas as to why the market has seen a decline?
Marc breaks down that over the last 40-50 days we’ve had Ramadan, Eid and Easter holidays - this means kids are off school, folks are off on holidays and transactions slow down. When it comes to Ramadan, the market slows down due to shorter hours and transfers slow down by 25%. Marc believes this happens every year and expresses that there is no cause for concern because month-on-month the market has been performing the best since 2022.
Marc further adds the difference between red-heads and blue-heads in a working environment. He says red-heads are those who search for instant results whereas blue-heads are those who are structure driven. He thinks the reason Allsopp & Allsopp succeeds at this is because we are structure driven. Yes, the market is performing the way it is but having many structure driven individuals part of a company - it builds a strong spine in the company. This helps the company drive forward even when the market sees a dip.
Paul then expands on the April report - according to our in-house sources there has been a 18% drop in Dubai based transactions compared to March 2023. This is mainly because of shorter working hours during Ramadan which affects the productivity levels and transaction rates. Still, when we compare the market year-on-year we still see a 45% rise compared to last year. In terms of volume, we’ve seen a 33% decline compared to March but still a 15% rise compared to last year; April.
According to the Dubai Land Department - Off-plan sales contributed to 52% of total transactions while 48% was secondary market. Although, looking at volume - the secondary market is ruling at 70%. Marc states this is mainly because of the top-tier transactions such as Jumeirah Bay, Bvlgari and more. There is a big hype in the luxury market and that’s why the secondary market in terms of volume is still ruling.
Paul then expands on the mortgages, as the fed rate has fluctuated over the course of one year multiple times, we saw a 40.7% increase in value - compared to last year. The demand and consistency though still shows a strong interest in the market. Marc says rentals are more pricey compared to mortgages even though the interest rates are higher now.
Moving ahead, Paul then discusses the massive undersupply for commercial properties - people cannot get their hands on properties. It's very tough to get commercial properties on hand as developers are still working on matching up to the market demand. Paul is giving a call out to developers to continue supplying us with more commercial properties.
Next up - Client registrations have seen an aggressive rise, renters are coming from overseas and within the city too. It's a very healthy growth and has been a great month for our sales and lettings team. A rise of 16.4% has been seen compared to last year. There was a 12.6% rise in buyer registrations and that’s what signifies the strength and demand of the market.
One of the new client registrations we’ve seen has been Canadian buyers. Dubai’s market has seen 3% of Canadian buyers for the first time. This implies that not only are foreign investors from Russia and China coming to Dubai but so are Canadians. Canada is another sought after destination for expats to relocate and invest so it is encouraging to see Canadians in the top charts.
Interested to hear more on the report - Tune into Taking Care of Business, every Friday!