The Holiday Homes market in Dubai has grown significantly over the last couple of years and many believed that Expo 2020 was a driving force behind the growth. With Expo 2020 now nearing an end, we may see a change in the holiday home market.
During the Expo, Allsopp & Allsopp saw holiday home lets bookings of up to a couple of weeks being the average booking time, however, bookings going forward have increased to an average of 30 days. We have seen many new expats moving into the city using holiday homes as their first point of call when looking for somewhere to live.
It seems that this trend is becoming a staple in the holiday home market which is excellent news for property owners who have leased out their property on a short-term basis. Of course, tourism will always be a factor when it comes to holiday homes but I see residents of the city taking advantage of the flexibility more. Allsopp & Allsopp saw a 24% increase in bookings from December, one of the most popular months for tourism in the city, to February 2022.
Allsopp & Allsopp have seen an increase in investors buying properties specifically for holiday home use. They are enticed by the potential 20-30% increase in revenue when compared to an annual lease and are seeing an increasing market for this type of property. As well as the high return on investment, holiday homes offer owners the flexibility that annually let properties don’t. Owners can block time for themselves to use the property and don’t need to give a one year notice period to tenants.
Expo has brought millions of people to Dubai, many of whom who have been working on and at the event. I predict that a number of these people could be looking into a life in Dubai on a more permanent basis - a lot like tourists who fall in love with the city. Holiday homes is the next and most sensible step for these people. The properties offer enough flexibility to allow a test drive of Dubai life.
Our holiday homes team have noticed that some people will book a holiday home in one community for 30 days and then go onto book a different community for a further 30 days. So, not only are they using the properties to test drive the city, but are using them to test drive different communities before selecting the right place for them before they make a more long-term commitment. This can be said for both tenants and buyers. Buyers, in some cases, are selling their property and using holiday homes as an option whilst looking for a new property to buy.
Key communities across Dubai are still a firm favourite for guests, however, communities such as Jumeirah Village Circle, Dubai Creek and Jumeirah Lake Towers are becoming increasingly popular with new expats. Expats are choosing locations that are close to metro stations, close to their new offices and further away from prime tourist destinations to avoid a premium price.
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