Dubai Property Boom: Millions in Profit for Sellers
Dubai: Property Owners Earn Up to AED 15 Million Profit in 4 Years
According to experts, the profit margin continues to grow for those who have made improvements to their properties.
Many Dubai residents who purchased property during or just after the Covid pandemic are now cashing in on soaring real estate prices in the city, with some earning up to AED 15 million by reselling their apartments.
"While many buyers from 2020 and 2021 are retaining their investments due to significant market improvements, we're witnessing a notable trend: the resale of properties, especially in central areas like DIFC and Downtown Dubai," said Lewis Allsopp, Chairman of the Allsopp and Allsopp Group.
"This is driven by the desire to take advantage of the current market boom. In some cases, particularly within villa communities, investors have realized remarkable profits, some as much as AED 15 million."
Over the past three years, property prices in Dubai have skyrocketed.
According to Louise Heatley, owner and managing director of Exclusive Links Real Estate Brokers, the resale profit margins have been higher in some areas. "On the conservative side, margins exceeded 30-40 percent," she said.
"But in highly sought-after areas like Downtown Dubai, Palm Jumeirah, and Dubai Marina, we've seen properties doubling in sales value since the market low in 2020. Off-plan projects, like Tilal Al Ghaf, provide excellent examples of initiatives started during the Covid price environment. Now, owners are selling at a 100 percent return on investment."
Improved Properties
Experts indicate that profit margins are higher for those who have enhanced their properties. "We've seen Garden Homes on the Palm Jumeirah originally bought for AED 8-10 million, refurbished, and re-market for over AED 50 million," Louise said.
Dubai resident Mansoor Ali is among those who have improved and resold their properties. He purchased a villa in Dubai Hills for AED 3 million in 2021. Over three years, he carried out beautiful landscaping and built a swimming pool. Additionally, he redesigned the home with an extra bedroom on the first floor. Earlier this year, he sold the villa for AED 8 million, making over 150 percent profit.
"I have long been investing in real estate in the UAE," he said. "However, I did not expect such a profit. Dubai Hills has appreciated significantly over the years, primarily due to its location and the excellent facilities of the community."
According to Lewis, there is a strong demand for such renovated properties. "These homes often sell quickly, sometimes before they are officially listed, and they command premium prices," he said.
"This trend reflects buyers' increasing preference for high-quality, move-in ready homes with unique features over developers' standard offerings. Many investors recognize this demand and focus on refurbishing properties to tap into this lucrative market segment."
Trends
Those selling their properties are not holding on to the profit but instead are reinvesting the money. "Most sellers reinvest their profits back into the market, often moving into newer off-plan developments or upgrading to more premium properties," said Louise.
"Dubai's ever-evolving real estate market continues to offer a steady stream of opportunities, with savvy investors preferring to keep their capital rotating."
According to Lewis, while many people have realized significant profits from reselling their properties, the margins are likely to cool down, especially for villas.
"Reselling real estate, especially for one-bedroom units or lofts in prime locations, can yield significant profits," he said. "Some clients have achieved up to 25 percent returns within a few months. However, profit margins in villa communities are declining due to increased fees from major developers."
Additionally, experts have noted other trends. "There is growing interest in sustainable, eco-friendly properties as buyers become more conscious of energy efficiency," Louise said.
"The luxury market also thrives, with high-net-worth individuals seeking unique properties, especially in waterfront locations and branded residences. Off-plan sales continue to dominate market share in transactions. We also see an increase in buyers demolishing and rebuilding villas in areas like Emirates Hills and Palm Jumeirah. This is starting to reflect in what buyers are willing to pay for premium plots."
