A little on what to expect in Abu Dhabi and Dubai after Covid-19 fades into a memory.
At this point, it’s hard to imagine a world free of the COVID-19 pandemic. But, in doing so, we’ve done more than just imagine what the real estate market will look like in the UAE once the pandemic is over. We surely will find ourselves in a new world.
A rapid vaccination protocol currently rolling out across the UAE will certainly change the country’s real estate landscape for the better. With more of the population able to travel within the country and for those looking to invest in countries with COVID-19 under control.
This goes for both rental and purchased properties. The more controlled COVID seems to be, the more desirable the location. Because the UAE is home to a vast number of expats compared to nationals, it’s already a huge draw to new real estate investors. Taming COVID will only add to the list of reasons expats choose to reside in Abu Dhabi and Dubai in the near future.
While the UAE real estate market in the pre-pandemic world was at a bit of a stand-still. The fact vaccinations are being so widely distributed here will likely be an enticement for those looking to relocate after the pandemic.
The postponement of Expo 2020 in the UAE has added some instability to the market throughout 2020. To meet the lower demand, developers have put a pause on new projects. Any plans to expand have also been put on hold in attempts to stabilize the market.
However, any instability lately has been on the demand side, not the supply side (Arabian Business). And so, as jobs open back up once vaccinations are widespread, demand is likely to increase (especially since many development projects have been paused to meet the lower demand). Landlords are also stepping up and responding to what their tenants want. Including lower rates, lease renegotiations, and shorter lease commitments, which shows signs of a maturing market.
According to Sidartha Mehta, a real estate executive at KPMG Lower Gulf, “Residential market sales in the UAE are gradually picking up compared with April and May when the pandemic had a significant impact on sales activity”. This is nothing but good news for the market in a post-pandemic UAE.
As real estate prices in the UAE have been steadily declining for the past 5-6 years (following exponential growth since the 1990s). It is about time for the market to level off and then begin making its recovery in a post-pandemic world. With the increase in remote working and “work from anywhere” trends that have been jump-started by the pandemic, it is quite possible the rental market will take off first, as creatives and “digital nomads” seek warm and unique places to make their living. After all, the UAE has always been extremely partial to expats.
While many in the market are taking a “wait and see” approach to real estate in the current state of things, the team at District Real Estate is extremely optimistic for the market in Abu Dhabi and Dubai, looking forward to when vaccinations are common.
We are looking forward to a world where the novel coronavirus is just a bad memory. But until then, investing in our local communities will be the key to long-term survival.