Record-high property prices in Dubai’s central districts, combined with aggressive off-plan payment plans by developers, are driving buyers toward the outskirts for more affordable options.
With soaring prices in popular areas like Downtown Dubai, Business Bay, Palm Jumeirah, Dubai Marina, Sheikh Zayed Road, and Dubai Hills Estate, many buyers and investors are exploring suburban and budget-friendly communities. These areas are now experiencing significant price hikes as demand shifts away from prime locations.
Suburban Communities Leading Price Growth
During the pandemic, prime locations saw consistent price growth due to high demand from millionaires and high-net-worth individuals relocating to Dubai. Villa prices jumped by 23%, and apartment prices grew by 19% year-on-year in Q3 2024, according to Cushman & Wakefield Core.
Suburban areas like Discovery Gardens, Jumeirah Lakes Towers (JLT), and Dubailand (Remraam) are seeing remarkable growth. Discovery Gardens recorded a 43% price increase, followed by JLT at 34% and Dubailand at 28%. Meanwhile, City Walk and Dubai Hills Estate registered moderate growth at 12% each.
“This shift is driven by the affordability of suburban properties compared to central districts,” said Prathyusha Gurrapu, Head of Research at Cushman & Wakefield Core. “Buyers are seeking value-driven investment opportunities in these areas.”
Aggressive Payment Plans Add to the Challenge
Developers in Dubai have introduced aggressive off-plan payment plans, with structures like 80/20 and 75/25, making homeownership more challenging for lower-income buyers. Rising construction costs and limited access to quality contractors have pushed developers to adopt such payment plans to ensure project completion.
Asteco, a real estate services firm, highlighted that off-plan properties in desirable locations are often sold out within hours, driven by factors like brand reputation, quality, and competitive pricing. However, these trends are pricing out families and individuals looking for larger homes.
