Affordable Housing in Dubai

Having lived in Dubai for nearly 10 years, there's one aspect that perplexes me: why do all developers solely focus on capturing 20 percent of the housing market? The cheapest ready 3-bedroom villas in Dubai are priced at AED 3 million, and even the new launches are priced around AED 2.5 million for a 3-bedroom villa.

When we consider the off-plan market, it becomes evident that properties are not selling as expected. The primary reason behind this is that every developer is targeting the same market segment. I struggle to comprehend why all these developers are fixated on the same customer base.

There are a few obvious issues with this approach. Firstly, there is a limited number of customers within this segment, and that is the current situation we face. The market is flooded with villas within this price range.

Secondly, when numerous properties of the same type flood the market, we experience an oversupply, which is the current condition. There are numerous off-plan properties available but not enough buyers. While equilibrium may be achieved in the long run, the concern lies in the short and medium term.

These circumstances clearly indicate the necessity for affordable housing in Dubai. It's crucial to recognize that there is a demand for affordable housing, which remains an untapped market for developers. It's important to understand that 75% of the population earns an average annual income of 40K. Hence, developers are currently not catering to this significant portion of the population.

Moreover, there's the issue of where individuals with lower incomes are expected to reside. We expect them to work every day but neglect to consider their living conditions. Currently, International City is the only place in Dubai where blue-collar workers can find accommodation, and even there, overcrowding is a concern.

Providing housing for the remaining 75% of the population is of utmost importance. Affordable villas priced between 600K and 900K would serve this market segment effectively. This market is still viable, and developers should shift their focus towards catering to this segment as well.