(MENAFN- Khaleej Times) Property prices in Dubai South and its neighbouring areas will see a jump - up to 15 per cent - this year as the relocation of the Dubai International airport is likely to boost demand.
Real estate industry executives predicted that prices would rise faster when the airport reaches its completion , with demand reaching over 100,000 properties in Dubai South and its vicinities over the next decade.
All operations at Dubai International (DXB) will be transferred to the new Dh128-billion Al Maktoum International gradually over the next 10 years. The airport will have a passenger capacity of 260 million annually.
Stay up to date with the latest news. Follow KT on WhatsApp Channels.
The emirate will build an“entire city” around the airport in Dubai South and this will drive a demand for housing for a million people.
Dubai South is already one of the most sought-after areas for people looking to buy villas and townhouses, ranked second by Betterhomes in terms of demand in the first quarter of 2024.
Thanks to Expo 2020 Dubai, several multinational corporations, including Amazon, Noon, FirstCry, Landmark Group, Siemens, and others, have already set up operations in Dubai South.
Svetlana Vasilieva, head of secondary sales at Metropolitan Homes, says a gradual rise in property prices can be expected within a year, potentially reaching 10-15 per cent, driven by anticipation of future growth initially.
“A more significant price increase is likely closer to the completion of the new passenger terminal at Al Maktoum International Airport. This is when the full impact of the airport's expansion and business activity becomes more tangible,” she added.
Vasilieva added that the Dubai government plans to build a city around the new airport with a capacity to house at least one million people.
“This suggests a significant demand for new houses in Dubai South. The logistics and aviation sectors are expected to boom with the new airport, creating job opportunities that will attract residents. Dubai South is envisioned as a major business hub, attracting companies and further fueling residential demand,” she added.
The relocation to Al Maktoum International will also boost the hospitality sector as the need for new hotels and serviced apartments will grow for transit passengers and business travellers, she added.
Faisal Durrani, partner and head of research for Mena at Knight Frank, said with projections for a million residents in the immediate vicinity of the Al Maktoum airport, there will be need of a concerted effort by developers to accelerate construction plans to house the expected influx of residents.
“The reactivation of the Palm Jebel Ali late last year is a further signal of the rising prominence of south western Dubai as a focal point for economic activity. How the supply story plays out will be one to watch, particularly as Dubai is only set to see 22,000 homes a year delivered over the next five years, well below the 70,000 units needed each year to accommodate a population of 7.8 million by 2040. Purely in the basis of the expected demand-supply imbalance, prices in the medium-long term are likely to experience sustained upward pressure, especially around Dubai South,” said Durrani.
100,000s of units
Over the next 10 years, Paul Kelly, operations director of Allsopp & Allsopp Group, sees the need for 100,000s of properties in Dubai South and surrounding areas, taking into consideration the population growth.
“Any developer sitting on land in the area will be making plans and any developer who hasn't already, will be looking at land options.”
“We expect to see property prices rising in Dubai South and the surrounding areas over the next ten years. Over that time, there may be some ups and downs, but the trajectory will be upward with all the developments, infrastructure, and entertainment venues. From this week, I expect a lot of market activity in these areas,” he added.
Suchit Odhrani, client manager at Betterhomes, said demand for new houses is expected to surge significantly, given its distance from heavy traffic and the improved road infrastructure in the area, making it more accessible for families and individuals to consider purchasing properties in Dubai South.
“Moreover, with approximately 2,000 units being launched in Dubai South each year, we anticipate this number to double as both investors and individuals currently commuting from afar for work are likely to show interest in relocating to the area,” he said.
Proximity to Abu Dhabi
Suchit Odhrani said property prices in Dubai South have experienced an upward trend since 2022, primarily due to the larger sizes of properties being launched there, surpassing the average sizes of apartments, townhouses, or villas closer to Downtown Dubai.
“Additionally, the proximity of Dubai South to Abu Dhabi adds significant value for residents commuting between both cities, offering an opportunity for individuals working in Dubai to reside in Abu Dhabi and vice versa,” added Odhrani.
Cherif Sleiman, chief revenue officer at Property Finder, said Strategically located near major transportation links, world-class attractions and amenities, the currently budget-friendly free zone development provides attractive property options for renters and buyers alike.
“The acceleration of operations and consequent shift to the new airport in Dubai South will open doors for more interest across property seekers while boosting searches in many nearby areas as well. Historically, large projects such as this lead to exponential upticks in the community interest, and the ongoing development of Dubai South lends to a new city centre equipped with cutting-edge planning and infrastructure,” added Sleiman.
ALSO READ
Will Dubai Metro be extended to Al Maktoum International Airport?
MENAFN02052024000049011007ID1108168001
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.