According to industry executives, plot prices in Dubai, particularly in prime areas, have experienced a significant surge, doubling or even quadrupling over the past two years. This surge has led to a scarcity of prime land plots in sought-after locations like Jumeirah Bay.
The increased demand for real estate in Dubai post-pandemic, coupled with high interest from local and international investors, developers, and individuals seeking to construct their own homes, has contributed to the substantial rise in plot sale rates.
Dubai’s Plot Market: Trends, Transactions, and Investment Opportunities
Dubai has witnessed a notable trend where sales of plots valued at AED 100M or more have become increasingly common in the past year. During the week ending on June 16, the Dubai Land Department released figures indicating that buyers purchased a total of 189 plots, resulting in transactions worth AED 2.28B.
Among these sales, the top three transactions included a land plot in Palm Deira sold for AED 167.88M, followed by a plot in Business Bay sold for AED 136M, and another plot in Al Thanyah First sold for AED 125 M.
“There is hardly any prime land available in Dubai at the moment,” says Ahmed Abou El Naga, head of institutional sales of Metropolitan Group.
“With the current spike in the off-plan market, we are seeing several local developers wanting to launch new projects. They are actively looking to secure prime plots, and as a result, we are seeing an upward movement in prices. We are also seeing international developers entering the market. Since the beginning of 2023, these developers are partnering with brokers, contractors and consultants to venture into the Dubai market,” said El Naga.
“As real estate prices have reached new highs, more and more people prefer to buy plots and build their own custom-made homes, rather than buying ready-made houses from developers as the cost of building a house may also be cheaper than buying it,” he said.
The Shift towards Custom-Made Homes: Rising Demand for Plots in Dubai
Industry experts identify three main types of buyers who show interest in purchasing plots in Dubai. The first group consists of individuals looking to buy and sell the plots when their prices rise. The second group comprises contractors who aim to develop projects on the plots and sell them afterwards. The third group includes end-users who wish to build their own homes on the purchased plots.
Notably, prices for certain plots in Jumeirah Bay and Palm Jumeirah have quadrupled, highlighting the significant appreciation in value, according to Khaleej Times.
Ahmed Abou El Naga from Metropolitan Group highlighted that plot prices Downtown have doubled compared to the pre-pandemic period. The prices of these plots have doubled, now trading at approximately AED 700 per square foot of gross floor area, compared to their previous value of around AED 350 per square foot.
While plots across Dubai, especially in sought-after areas, are in high demand, waterfront plots hold the greatest appeal. Locations like Palm Jumeirah, Dubai Water Canal, Business Bay, Jumeirah, and Al Sufouh hold particular appeal to buyers, especially for mixed-use plots offering a sea view.
Moreover, prime locations near popular tourist attractions like Dubai Mall also experience strong demand. For those interested in villas and townhouses, plots for developing communities are highly popular in Meydan and Dubai Land.