Dubai Real Estate Market Report — December, 2020

Dubai Real Estate Market Report – December 2020

December 2020 drew the curtain on a year thrown into disarray by the COVID-19 pandemic. Once the UAE's movement restrictions had suspended much in-person property activity through the spring and early summer, the market spent the second half fighting back — and the closing month revealed just how far that recovery had come. Across apartments, villas and commercial units, 3,467 sales worth AED 5.40 billion changed hands, pushing volume 30% and value 21% above December 2019.

With every property type counted in, plots included, the month registered 3,680 transactions adding up to AED 7.20 billion at a median of AED 908/sqft. The character of the rebound is revealing: buyers came back in strength, but on softer pricing rather than a return to pre-pandemic price levels.

Headline figures

Year-on-year performance by category

The expansion was powered by apartments. The segment logged 2,547 sales — up 36% year on year and 668 more than in December 2019 — its highest December volume since 2017. Value rose 20% to AED 2.94 billion. The price story, though, moved in reverse: the median stood at AED 1,050/sqft, down 10% on the year and 15% below the 2014 baseline, the weakest December reading since 2015. The median apartment ticket fell 19% to AED 796,195. Put simply, more homes traded largely because they had become cheaper.

Villas offered a quieter but sturdier take on the same recovery. Transactions grew 21% to 808 — 140 above the previous December and the busiest December for the segment since 2014 — while value advanced 23% to AED 2.33 billion. Pricing proved far more stable than in apartments: the median eased only 2% to AED 694/sqft, though that still sits 17% beneath its 2014 level. The median villa ticket, for its part, jumped 28% to AED 2,158,500 — the strongest ticket growth of any category.

Commercial property was the one segment to slip back. Volumes fell 14% to just 112 deals — 18 fewer than a year earlier — even as total value edged 10% higher to AED 129.83 million on a slightly firmer median ticket of AED 650,000 (up 2%). The sector's pricing weakness stands out: at AED 658/sqft, down 9% on the year, the median marked the lowest December figure in the seven-year series and sits 48% below its 2014 level — a sign that offices and retail trailed the residential rebound.

Every category, including plots and buildings

Beyond the three main categories, plots were a sizeable contributor to the all-property headline: 213 plot transactions produced AED 1.80 billion at a median of AED 475/sqft and a median ticket of AED 3,700,000 — the biggest typical deal size among the property types listed. Their inclusion is the chief reason the all-property totals run ahead of the narrower apartment-villa-commercial figures.

Primary versus resale

New-build sales led on count: primary deals made up 63% of apartment, villa and commercial volume — 2,177 transactions worth AED 3.03 billion. Resale was the smaller slice of activity at 37% (1,290 deals, AED 2.37 billion), yet it punched above its weight on value at 44% of the total — seven points clear of its volume share — reflecting the higher average price of finished, ready homes.

Where the activity was

Marsa Dubai headed the value table at AED 700.99 million, ahead of Business Bay on AED 542.77 million, with Dubai Investment Park First (AED 364.63 million), Downtown Dubai (AED 294.75 million) and Hadaeq Sheikh Mohammed Bin Rashid (AED 279.83 million) rounding out the top five. By transaction count the order shifted: Business Bay led with 408 deals, followed by Marsa Dubai (320) and Al Barsha South Fourth (310), then Al Thanyah Fifth (171) and Al Barsha South 3 (168).

Rental market

The leasing market mirrored the sales pattern — busier, but cheaper. New apartment contracts jumped 30.50% to 11,239, yet the median new apartment rent fell 18.75% to AED 39,000; renewals were broadly flat in count (+1.96%) with rents down a comparable 18.97% to AED 47,000. New villa leases rose 25.73% to 1,202 as their median rent slipped a gentler 8.33% to AED 110,000. Commercial demand held steadier — new contracts up 3.95% — with median new rent off 9.59% to AED 66,000. In every segment, tenants gained ground as rents fell.

Supply

New supply all but ground to a halt. Only 366 units across a single project were launched during the month, versus 4,223 completions from 8 delivered projects — a launch-to-delivery ratio of 0.1 and a net of 3,857 more units delivered than launched. With the pandemic freezing new project starts against a healthy pipeline of handovers, supply was overwhelmingly a matter of finishing homes already under way rather than starting new ones.

Launched

• 15 Northside - Tower 2 – Business Bay (Select Group), 366 units

Delivered

• Dolphin Tower – Business Bay (The First Group), 340 units
• Bella Rose – Al Barsha South 2 (Deyaar), 494 units
• Avalon Tower – Al Barsha South Fourth (The First Group), 368 units
• Damac Hills - Artesia Tower D – Al Hebiah Third (Damac), 1,261 units
• Naseem Townhouses – Al Yelayiss 2 (Nshama), 322 units
• Mag 318 – Business Bay (Mag), 473 units
• Azizi Aura Residences – Jabal Ali Industrial Second (Azizi), 487 units
• Damac Hills (2) - Janusia – Madinat Hind 4 (Damac), 478 units

Most expensive sales

Top apartment sales

1. AED 16,000,000 – Bridge Sky, Downtown Dubai
2. AED 14,316,420 – Bluewaters Residences 5, Marsa Dubai
3. AED 13,189,000 – Bluewaters Residences 4, Marsa Dubai
4. AED 12,854,000 – Bluewaters Residences 1, Marsa Dubai
5. AED 12,589,000 – Bluewaters Residences 3, Marsa Dubai

Top villa sales

1. AED 40,500,000 – Emirates Living
2. AED 25,500,000 – Palm Jumeirah
3. AED 15,099,277 – Al Merkadh
4. AED 13,700,000 – Hadaeq Sheikh Mohammed Bin Rashid
5. AED 12,250,000 – Wadi Al Safa 3

Notes on methodology

Scope. The headline totals and the category table take in every property type present in the data, Plot and Building included. The primary/resale breakdown, the top-area rankings and the year-on-year series are limited to Apartment, Villa and Commercial, which is why those numbers are intentionally smaller than the headline and should not be summed across sections.

Rounding. The headline totals are the definitive rounded numbers. Category-level breakdowns are rounded on their own and may not add up precisely to the headline.

Definitions. Price figures refer to medians rather than averages. Year-on-year sets the period against the matching period a year before. All values are in AED and areas in square feet.