UAE: New airport plan to stimulate demand for real estate and prices in Dubai South - News | Khaleej Times

On Thursday, May 2, 2024, experts predict an increase in real estate prices in Dubai South and neighboring areas this year.15 percentSuch growth is expected due to the planned relocation of Dubai International Airport, which will boost demand for housing. Real estate experts noted that as the construction of the new airport is completed, interest in housing in Dubai South and its surroundings will increase even further. In the next ten years, there will be a need formore than 100 thousand real estate propertiesAll operations at Dubai International Airport (DXB) will gradually be transferred to the new Al Maktoum Airport, the construction of which is estimated at128 billion dirhamsThis airport will be able to serve up to260 million passengers per year.

Planned development around the new airport

A "whole city" is planned to be built around the new airport in Dubai South, which will be able to accommodateup to a million residentsDubai South is already considered one of the most attractive locations for purchasing villas and townhouses, ranking second in demand for such properties according to Betterhomes in the first quarter of 2024. After EXPO 2020, many large international companies, such as Amazon, Noon, FirstCry, Landmark Group, and Siemens, have already opened their offices in this area.

Forecasts on the impact on the real estate market

Svetlana Vasilieva, head of the secondary real estate department at Metropolitan Homes, notes that over the course of the year, a gradual increase in housing prices can be expected, which may amount to10 to 15 percent"Since the prospects for future development stimulate activity in the market. However, a sharper increase in prices is expected closer to the completion of the new passenger terminal at Al Maktoum Airport. It is during this period that the real effect of the airport expansion and the growth in business activity will become noticeable," she added.

Vasilieva also emphasized that the Dubai government plans to build a city around the new airport, which will be able to accommodate at least one million residents. "This indicates a significant need for new housing in Dubai South. Logistics and aviation are expected to develop in this area, creating jobs and attracting new residents. Dubai South is becoming an important business hub that will attract companies and thus contribute to the growth in housing demand," she noted.

Impact on the hotel industry

The relocation of operations to Al Maktoum will also have a positive impact on the hotel business, as there will be an increased demand for new hotels and serviced apartments for transit passengers and business travelers, she added.

"The lifting of restrictions on the construction of Palm Jebel Ali at the end of last year also confirms the growing significance of southwest Dubai as a center of economic activity. It will be important to closely monitor how the situation with real estate supply develops, especially considering that only..."22 thousand new housing units annuallyover the next five years, which is a significantly smaller figure compared to what is needed70 thousand units“to serve a population of 7.8 million by 2040,” noted Durani.

The need for new real estate properties

Pavel Kelly, the Chief Operating Officer at Allsopp & Allsopp, predicts that over the next ten years, it will be necessary to buildhundreds of thousands of new objectsIn Dubai South and the surrounding areas, considering the population growth. "Every developer with land in this area is already developing plans, and those who haven't started yet will also be looking for new plots," he said.

“We expect property prices in Dubai South and the surrounding areas to rise over the next decade. Despite potential fluctuations, the overall trend will be positive due to new projects, infrastructure, and entertainment facilities. This week, I anticipate at least an activation of the market in these areas,” he added.

Increase in demand for new housing

Shuchit Odrani, the client manager at Betterhomes, reported thatThe demand for new housing will significantly increase.Due to its distance from major transport flows and the improved road infrastructure in the region, it has become more accessible for families and individuals considering purchasing property in Dubai South. "Additionally, approximately every month,2,000 housing units“in Dubai South, and we expect this number to double, as both investors and individuals working remotely may show interest in moving to this area,” he added.

Shuchit also noted thathousing prices in Dubai SouthThey have been gradually increasing since 2022, which is related to the larger sizes of the properties compared to the average apartment deals offered closer to the center of Dubai. "Additionally, the proximity of Dubai South to Abu Dhabi adds significant value for residents who commute daily between the two cities, allowing them to live in one and work in the other," he added.

Attractiveness for tenants and buyers

Sheriff Sleiman, the Chief Commercial Officer of Property Finder, noted thatstrategic locationThe proximity to major transport links and well-known attractions, along with affordable real estate prices in free zones, makes this area attractive for rental and purchase. "The acceleration of operations and the corresponding transition to the new airport in Dubai South will open up new opportunities for interest from potential tenants and buyers, as well as increase the search for real estate in nearby areas. Historically, such large-scale projects trigger a sharp rise in interest in the community, and the ongoing development of Dubai South is shaping a new urban center with modern planning and infrastructure," he concluded.