UAE property market to decline further as oversupply hits close to 1mln units

SectorReal Estate

Demand for real estate in the UAE sunk during the global coronavirus lockdown early last year. Sales transactions and delivery of new units started to improve only after the restrictions eased.Low prices enticed buyers to flock to the market during the late part of 2020. November and December, in particular, saw “both breaking the secondary and ready market transactions records” for the past seven years, according to Property Finder.More housing supplyJLL’s report noted that as of the last quarter of 2020, Dubai and Abu Dhabi have a combined residential stock of 860,000 units. An additional 68,000 units are expected to be delivered this year.“After various lockdown measures put construction activity on hold in the first half of the year, [the second half of] 2020 saw a rapid recovery in residential project handovers,” JLL noted.For the whole of last year, Dubai witnessed the handover of 39,000 residential units, thereby increasing its supply to 595,000.

Abu Dhabi, for its part, saw 4,000 new units delivered in 2020, raising its stock to 265,000.For years prior to the coronavirus pandemic, the property market in the UAE has been witnessing a decline, owing partly to a huge supply glut.Sale prices, rentIn terms of more...