The real estate market in Dubai has always been a landscape, with certain areas becoming hotspots of growth due to regulatory changes. One of the latest developments by the DLD that spiked interest is the recent shift to freehold ownership for properties along Sheikh Zayed Road and in Al Jaddaf. But what does this mean for property prices, and how high could they go?
The Impact of Freehold Ownership
The Dubai Land Department (DLD) recently announced that all private property owners from the Trade Centre Roundabout to the Water Canal on Sheikh Zayed Road, as well as in the Al Jaddaf area, can now convert their ownership status to freehold. This change is expected to influence demand among investors and end-users, leading to an increase in property transactions and values.
Industry executives believe this move will stimulate substantial interest from both local and international investors, with commercial properties likely to benefit the most initially due to a persistent shortage of quality office spaces in Dubai.
This change is expected to:
- Increase Demand: Freehold ownership often attracts international investors looking for secure, long-term investments.
- Boost Investor Confidence: With the promise of full ownership, investors feel more secure, which can lead to an increase in property transactions.
- Transform the Market: Both Sheikh Zayed Road and Al Jaddaf are likely to see increased interest, making them highly competitive markets.
How High Can Prices Go?
A total of 457 plots have been identified as eligible for freehold conversion under the new rules by the Dubai Land Department. This includes 128 plots along Sheikh Zayed Road, stretching from the Trade Centre Roundabout to the Dubai Canal, and 329 plots located in the Al Jaddaf area. Though precise projections are difficult, similar regulatory changes in Dubai’s real estate history suggest a marked increase. Analysts forecast a rise of 15-30% in property prices over the coming years, depending on factors like market conditions and the pace of development.
Economic and Strategic Impact of the Freehold Status Change
The freehold initiative is also expected to significantly enhance the economic attractiveness of Sheikh Zayed Road and Al Jaddaf, paving the way for new real estate developments for freehold investors. This change is predicted to attract a fresh wave of investment into these prime areas, further solidifying their appeal.
Marwan Ahmed bin Ghalita, director-general of DLD, emphasized that this regulatory shift would drive substantial growth in Dubai’s real estate sector. He highlighted that the move aligns with Dubai’s Real Estate Strategy 2033, the city’s status as a global economic hub and a top destination for real estate investment.
“This initiative will not only enable owners to benefit from price changes but will also enhance the attractiveness of the Dubai real estate market, drawing long-term investments,” said bin Ghalita. “The Dubai Land Department is committed to providing all the services needed to facilitate this move.”
Eligible property owners can confirm their ability to convert to freehold status using the Dubai REST smart app.
Process for Applying for Land Assessment
To begin the conversion process, property owners must submit an application to the Dubai Land Department (DLD) for land assessment and valuation. The associated common area fees and service charges will be established in line with guidelines issued by the Real Estate Regulatory Authority (RERA). Following this, a conversion fee equaling 30% of the property’s valuation, calculated based on the floor area, will be required. Once the payment has been completed, property owners will receive a map and an official freehold ownership title deed for the converted property.
This initiative aligns with Dubai’s Real Estate Strategy 2033, which seeks to achieve ambitious goals, such as increasing real estate transactions by 70%, raising the total market value to AED 1 trillion, and expanding Dubai’s real estate portfolio value to AED 20 billion. By granting freehold ownership to all nationalities in prominent areas like Sheikh Zayed Road and Al Jaddaf, Dubai is set to increase investor confidence and strengthen its position as a prime global destination for real estate investment.
Factors Influencing Price Growth in These Areas
Several factors could drive property prices upward in these areas:
- Prime Locations: Sheikh Zayed Road remains one of Dubai’s most desirable addresses, and Al Jaddaf’s proximity to the Creek and its emerging infrastructure make it highly attractive.
- Infrastructure Development: Continuous improvements in transportation, retail spaces, and community facilities add value to properties in these areas.
- High ROI Potential: Investors are likely to target these areas for rental properties, given their prime location and appeal to residents and businesses alike.
- Economic Growth: As Dubai continues to attract global businesses and tourists, areas like Sheikh Zayed Road and Al Jaddaf stand to benefit from increased activity and demand.
The shift to freehold ownership along Sheikh Zayed Road and in Al Jaddaf is a game-changer for Dubai’s real estate market. With a blend of prime locations and a growing economy, these areas are set to become even more desirable. For investors and homebuyers alike, this presents a unique opportunity to secure assets in two of Dubai’s most promising neighbourhoods.
As always, potential buyers and investors should conduct thorough research and consult with real estate experts like Milestone Homes to make informed decisions. The future of Sheikh Zayed Road and Al Jaddaf looks bright—and so does the potential for growth.
Sources: Gulf Business, Khaleej Times, The National
WhatsApp