Dubai's real housing shortage: affordability above all

Anyone who follows the Dubai real estate market hears it time and again: “There is a housing shortage.”

But that statement is too simplistic. Because it's not about the number of homes per se, but about affordability. of it.

High entry prices and investor dominance

In recent years, new neighborhoods and projects have been added, with entry-level prices already high at launch. Combine this with the fact that the majority of buyers are investors (not end users), and you see a pattern emerging.

Investors buy to generate returns. This means that rental prices in these projects can already be calculated to some extent. The result? A gap between supply and demand is created: the homes are available, but the target group can't afford them.

Why This Matters

A building can have excellent quality and be in a prime location, but if rents do not match the incomes of the people who have to live there, vacancies or price pressure will arise.

What should you pay attention to as an investor (and broker)?

Location and quality are and will remain crucial! But it's too easy to blindly rely on them.

Important additional factors are:

• Price per square foot : how does it compare to surrounding projects?

• Total number of apartments : the greater the supply in one building, the greater the competition upon completion.

• Target group of the neighbourhood : will they be able to afford the rent prices in the future?

Many real estate agents stop providing support once you've purchased an off-plan unit. But the real question then arises: "Can this apartment actually be rented or sold at the price you envision?"

I often hear real estate agents say: “The location is great and the quality is superb!”

But if the price is too high and the space too small, you're not making a smart long-term investment. End users and tenants ultimately choose space . And if it's not available, they simply look elsewhere.

Yes, location remains king. But don't be blinded by the simple story of a housing shortage. Take a critical look and assess whether the price and product are appropriate for the target audience. Only then will you build an investment that will last even after completion.

Questions about the market or real estate investments in Dubai?

Contact Daan Welvaart via daan@mijnhuisindubai.com or via WhatsApp .