Almost 177,000 new people have arrived in the emirate since last year
Dubai: A total of 32,822 residential units in the freehold and non-freehold communities were completed in Dubai in the first nine months of the year and another 13,216 units have a completion date towards the end of 2019 or Q1 2020, according to Data Finder, the real estate insights and data platform under the Property Finder Group.
However, since the actual completion rate has generally been 40 to 50 percent of expected completion, only around 6,500 units are likely to be completed in Q4 2019. Cumulatively, that amounts to approximately 39,000 residential units completed in the whole year, predicted to be the highest in the last several years. In comparison, 33,881 residential units were completed in Dubai last year.
The current population in Dubai as of Q3 2019 was 3.34 million, according to data from the Dubai Statistics Centre. This represents an annual increase of 177,020 people or a growth of 5.64 percent compared to Q3 2018.
Currently, there are 59 projects in Dubai with a completion percentage of 97 to 99 percent. However, even with a high completion status, not all projects will achieve completion this year, going by previous completion rates. This could either be due to project delays or because developers do not want to flood the market with more supply.
Shift in developer approach
“Going into next year, I believe we will start to see a shift from developers. I believe less new projects will get launched as developers will concentrate on completing their current projects and selling their large inventory of ready/completed units. I also expect to see more creative payment schemes from developers who have large, ready inventory as well as rent-to-own schemes in efforts to move their stock,” says Lynnette Abad, Director of Data and Research, Property Finder.
Even at this year’s Cityscape Global in Dubai, developers focused on the sale of existing inventories. This follows steps taken by the government to limit future supply, with the recent announcement of a Real Estate Planning Committee in Q3 2019.
Developers are also responding to the need for lower levels of future supply, with only 68 projects launched in the first nine months of 2019, according to Property Finder.
Apartments dominate upcoming supply
Of the 13,216 units slated for completion between Q4 2019 and Q1 2020, the majority are apartments (11,499), while the remaining are villas/townhouses (1,018) and serviced apartments (699).
Business Bay will see the highest number of residential units completed in the remainder of the year (1,726), followed by Dubai Silicon Oasis (1,066), Al Furjan (986), Dubai South (810) and Dubai Sports City (792), according to Data Finder statistics.
Other communities where houses are scheduled to be completed this year are Dubailand, Muhaisnah, Town Square, Jumeirah Village Circle and the Palm Jumeirah.
While there are concerns of supply increasing, a more affordable market overall would be a welcome trend for residents and investors.