Supply and demand is yet a huge chapter to read before planning your investment in the real estate market. The law of supply and demand exists in every market but it’s the most important deciding factor in the real estate market.
Let’s say, you were trying to buy a private villa in Dubai’s main town. But you see that the price of the property is gradually increasing and finally the property gets sold out to another buyer who is ready to buy it immediately!
Every real estate investor would have come across such situations at least once in their life.
But, why do such situations arise?
This is called the dynamics of supply and demand. When the supply is more but the demand is less, the value automatically goes down. But when demand is high and supply is less, the property value will rise at its peak.
Marketers make a huge profit only when demand is high. So we can call supply and demand ‘the driving forces’ of the real estate market in Dubai. This blog gives you an in-depth insight into what – when – and how supply and demand impact the Dubai real estate market!
What is Supply and Demand?
Any product or service available for selling becomes a supply. Similarly, any product or service available for buying becomes a demand. You supply something when you have it abundantly and to make a profit. You buy something when you require it.
In the case of the real estate market, the supply and demand varies by location. Before investing in the properties, pay attention to the local market. Keep yourself updated with the local news about the rise and drop in business trends. Sometimes, you even get a chance to witness drastic fluctuations in the supply market when the sellers try to hide the demand market from the investor’s view.
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When can we say that the Supply and Demand Market is in Balance?
What is the biggest difficulty in the supply and demand system? Finding a stable supply and demand market is the biggest challenge, especially in real estate. Supply involves lots of effort – from preparing a property for sale to finding the right buyer. Above all, satisfying the unique demands of the buyer becomes the biggest challenge of the era.
But, when all the sellers can sell their properties and all the prospective buyers can buy what they need, the supply and demand market is said to be stable and balanced. But such cases are rare. Have you ever seen such cases?
How do Supply and Demand Influence the UAE Real Estate Market?
In 2023, over 35,160 properties were completed, that includes 28,650 apartments, 5,187 villas and townhouses, and 1,323 commercial properties across 154 projects. Dubai witnessed rapid development inviting local and international investors to the town. The economic value of Dubai is slowly rising and real estate is blooming as never before.
And yes, some factors are contributing heavily to this play. To list a few;
● New developments and facilities
● International tourism
● High population and employment opportunities
● Government tax benefits
● And more to add…
Dubai was a place with a huge supply but the demand was less. That was a decade before. Now Dubai has got a huge demand among local and global investors. The supply rate is slow because Dubai ends up providing luxurious and affordable living which takes time. Hence, if you are planning to invest in the Dubai real estate market, do it today! The best plan would be to invest in the off-plan apartments and villas in Dubai.
Who would miss a chance to enjoy a luxurious lifestyle at an affordable cost?
Are you going to miss it?