December 21 2016
By Lookup.Ae Editorial Team
This report analyzes the Dubai freehold townhouse market in Dubai through a series of graphs & charts. You will learn more about where supply is located and how supply is entering the market. We also take a look at historical prices and market positions for investors.
The below infographic gives an overview of the locations and status of the majority of the freehold villa & townhouse communities in Dubai as of December 2016. The contents of this presentation are focused entirely on the townhouse market.
Historic Look At New Townhouse Launches
The number of actual townhouse units launched in 2016 was 41% lower than 2015 (2,874 units launched versus 4,939 launched in 2015). However, a lot of communities launched this year have major scope for future phase launches including Urbana, Serena, Villa Nova, Town Square and Akoya Oxygen.
Historic Look At Townhouse Launches Versus Deliveries
The below chart compares the new units launched versus units delivered by year.
How Supply Could Grow
The supply of townhouses in Dubai will likely double in the coming 4 years (even considering project delays).
But Supply Enters The Market Quite Slowly In Dubai
The below table gives a historical perspective on expected supply vs actual delivered. Almost all projects in Dubai launch with 3 year delivery timelines but we typically see delivery periods ranging from 3.5 – 4.5 years. On a very positive note, most developers now offer construction linked payment-plans.
Historic Price Trends
The absolute peak of the townhouse market was in Q1 2014 when average prices were about AED 1,211 per sq. ft.
In Q4 2016, prices are 15.3% lower on average then market peak.
Change in capital prices for townhouses in Dubai from Q1 2016 through Q4 2016 was less than 1% signaling a fairly stable market.
Current Market Positions
Looking at the chart below can help you understand what your approximate current market position would have been based on your purchase period (i.e. if you purchased a townhouse in Q1 2013, at today’s prices your average capital gains would be approximately 11%. The peak gains you achieved would be approximately 27%.
If you purchased your townhome in Q1 2014, at today’s prices your average capital decline was about 13%; however, at the lowest period it was about 15% - signaling a market recovery.
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