Dubai Villa Prices Gush by 20% on Return of Growing Demand

A gush of 20% in the price was experienced by the villas in Victory Heights Dubai Sports City in the Q3 of this year. The prices had fallen by 50% in the Q1 of the year due to the global economic recession.

It was observed that the main reason of the push in the prices was the growing demand for family homes in Dubai. The trend is expected to persist if recent prophecies of a villa shortage in 2010 works.

Yasser Abdulrahman Al Raee, the General Manager at Victory Heights said, “The fall in the price of villas seems to have bottomed out, and we are starting to see prices rise again. Since July prices for villas in Victory Heights have risen by about 20 percent, and we expect to see prices stay around the same figure to the end of the year."

He added,"Despite the recession families still are looking to find spacious homes, with quality finishing, in developments that have a community spirit - and that's what we offer at Victory Heights. Families are moving here from other developments in Dubai because they get like being away from the bustle of the city, and just a stone's throw from the all the sporting facilities of Dubai Sports City."
The potential shortage of villas on offer in Dubai in the next few years was highlighted by Landmark Properties CEO, Charles Neil, in an interview with Emirates Business on 29 November.

According to Charles Neil, CEO of Landmark Properties, “the number of units coming online in 2010 will jump to 50,000 - of which 20 percent will be villas, and the rest apartments. In 2011 the number of new villas will drop to five percent, and to three percent in 2012.”

Authentic Spanish Andalusian, Mediterranean and classic European style are the three styles in which villas at Victory Heights are designed. Many of these enjoy the views of the Els’ Club course. The developer promises to foster a strong community spirit by holding regular community events like BBQs.

Dubai Real Estate to See 50,000 units in 2010 - Industry Analyst

As per the statement of Charles Neil, the new CEO of Landmark properties, merely half of the units out of the 50,000 units will be available for rent.

Neilsaid, “In 2008 and 2009 the delivery has been pretty steady at about 30,000 units a year. In 2010, it looks as though it will jump to 50,000 units, of which villas will be 20 per cent."

After 2011, fewer villas will start coming on to the market and after 2012, Landmark may see scarcities. He added, “If you're looking at villa prices, they actually went up a bit during the third quarter because there was no finance available. Now that finance has eased, prices and rents in places such as The Palms, Springs and Meadows went up between eight and five per cent, respectively."

Neil commented on the future by telling the sources, “The big issue for next year is what's happening with supply. In 2008 and 2009 the delivery of supply has been pretty steady at about 30,000 units a year. In 2010, it looks as though it will jump to 50,000 units, of which villas will be 20 per cent. And then in 2011, the number of villas drops to five per cent and in 2012 to three per cent, so there are very little villas coming on. You can see a shortage in the villa market."

"With apartments there will be a big surplus next year. The question is how much of that will translate into inventory. Today, the housing stock is about 330,000 units, which will go up to 380,000 in 2010. You need probably a population of 150,000 to fill that. Now where is that going to come from? The answer is there could probably be a two to three per cent growth in Dubai's economy next year."