Developers are intensifying efforts with EMI offers under 1% and extended payment plans on ready homes, as offplan launches and sales in Dubai accelerate in response to potential near-term price corrections.
As concerns over potential price corrections loom, developers in Dubai are rapidly launching new projects and releasing additional offplan units, not just to meet demand but also to safeguard against any future market slowdowns.
A recent report from the global rating agency S&P highlighted the possibility of price corrections in the Dubai property market within the next 18 months, which could lead to lower property prices and rents. This warning has prompted many developers to fast-track their launches, aiming to capitalize on current market conditions before a potential decline.
To attract buyers, developers are offering enticing payment plans, such as monthly installments under 1% of the property value and guaranteed returns. Some developers have extended payment options for ready-to-move-in homes, with plans stretching up to two years, while others have introduced long-term payment plans ranging from five to eight years.
The aim is clear: close sales quickly. “The S&P report on Dubai property prices has been an eye-opener,” said a developer. “If rents drop as predicted, investors might delay their decisions, leading to potential stagnation in the market. We’re also seeing growing competition from new projects in Expo City Dubai, which could drive future price growth in other locations.”
Surge In Offplan Property Launches In October:
Dubai’s property market saw a significant boost in October, with nearly 18,000 new offplan properties introduced, according to data from Reidin-GCP. This marked a sharp increase from the average of 11,000 to 12,000 units per month over the previous four months.
Sales have kept pace with this surge in new launches. October alone saw approximately 14,000 offplan units sold, surpassing the previous monthly record of 11,698 set in May.
Stable Prices Expected In 2025, But Launch Pace May Slow:
Sapna Jagtiani, a credit analyst at S&P Global Ratings, predicts that the average sales price per square foot in Dubai’s primary market will remain stable in 2025. However, she also expects the pace of new launches to slow over the next 12 to 24 months, with a reduction in the share of luxury developments.
There have been recent reports indicating a slight correction in the average price per square foot for offplan properties in Dubai over the past two months. This price adjustment is likely due to a higher proportion of mid-market homes in these launches.
Mid-Market Developers Concerned About Potential Delay In Buyer Decisions:
Developers in the mid-market segment are particularly concerned about potential delays in buyer decisions. If investors anticipate a price correction, whether in 18 months or sooner, they may hesitate to make purchases, which could disrupt the market’s pricing cycle. Developers may then be forced to offer more incentives or lower their asking prices, potentially accelerating a full-scale price correction if the trend is left unchecked.
Luxury Market Remains Resilient:
Meanwhile, the luxury and super-luxury sectors are showing more flexibility in pricing. This year, Dubai has seen several high-end projects catering to wealthy buyers, and more are on the way. For instance, Nakheel recently released more villas for Palm Jebel Ali, starting at Dh18 million. Sharjah-based Arada is also adding to its Dubai portfolio with the W Residences at Dubai Harbour, a Dh5 billion project featuring over 400 Marriott-branded apartments across three towers. Additionally, Arada has an Armani project in the works.
Trump Tower Project In Dubai:
Luxury developments in Dubai continue to flourish, with FTSE-listed Dar Global announcing plans to launch a Trump Tower in Dubai by 2025. The Trump brand is already well-established in the city, thanks to a longstanding partnership with Damac Group.
“There seems to be a lot happening, or about to happen, in Dubai’s luxury property market,” said one developer. “While luxury developments can afford to wait longer for buyers, mid-tier launches face more competition, with new projects frequently hitting the market shortly after the previous ones.
