Industry executives state that there has been a notable increase in demand and prices for waterfront properties, particularly along the E-11 highway, encompassing areas like Marina and Palm Jumeirah, as well as the city center and Business Bay area. While there is limited availability of new development projects in these areas, many new developers from Europe, Asia, and the Middle East are entering the Dubai real estate market, seeking higher returns, thereby increasing demand for real estate development plots.
The most significant price increases are observed in luxury land plots. According to John Allen, CEO of valuation and consultancy firm Asteco, residential villa land plots in areas such as Jumeirah Bay, Jumeirah Palm Island, Jumeirah Pearl Island, and La Mer South Island have seen the highest price increases, soaring by up to 60%, with an average increase of 25% to 30%. Among them, Jumeirah Bay has witnessed even higher increases, reaching 45% to 50%. Prices for various plots have seen a wide range of increases, ranging from 20% to 30%, with some areas experiencing even higher surges of 50% to 60%.
The reasons for these price increases include saturation in certain areas like Business Bay, the waterfront, and Palm Jumeirah, where the supply of new development projects has become limited, leading to a surge in residential community prices. Another factor is the entry of numerous foreign developers into the Dubai real estate market, increasing demand for real estate development plots and driving up prices.
Additionally, the emergence of large new communities such as Emaar's Oasis plan and Azizi Developments' Venice project has also increased the demand for residential project development.
According to Rizwan Sajan, Chairman and Founder of Danube Group, land prices for the Seafront City project have increased by 50%, and the plot prices for the upcoming Bayz project in Business Bay are expected to experience significant increases. He anticipates that after the completion of the Bayz project, located just steps away from the Dubai Mall and the metro station, apartment prices will rise by 50% to 60%, or even double.
For investors, projects and apartments on waterfront land plots are expected to yield higher returns, along with higher rental rates. John Allen of Asteco adds that there is a significant demand for residential villa land plots in areas like Jumeirah Bay and Jumeirah Palm Island. Similarly, commercial development land plots located in Business Bay and along the Dubai Water Canal are in high demand. Overall, all commercial development land plots along the canal have experienced a significant increase of about 60% within a year.
However, several residential communities and commercial projects still offer various choices, such as Jumeirah Ali Hills, Mirdif, and Nad Al Sheba. Allen further notes that community land plots near the E11 Road corridor, such as Dubai Marina, Burj Khalifa Downtown, Jumeirah Palm Island, and Business Bay, are the most scarce. In secondary locations like the E311 - E611 Road corridor, development plots with a comprehensive master plan are becoming increasingly scarce. However, development projects in some secondary locations also face challenges due to scarce land plot supply.
