1. Definition of the area and data structure
Actual location: Elara 1 belongs to the Um Suqaim Third district (according to the DLD database). Master project and project: the property is part of the ELARA project. Information on the master project is not explicitly presented in the DLD database, which is typical for new developments.
For Elara 1, 87 transactions are recorded in the sales table. No direct transactions with studios (0-bedroom units) were found, however all apartment transactions in the building are present. In the rental table, no contracts have been registered either for the building itself or for the ELARA project, so to analyse the rental market and profitability we had to rely on official DLD statistics for the Um Suqaim Third district.
2. Transaction activity and liquidity
A significant volume of transactions falls on the last two quarters: 24 deals in Q4 2023 and 55 in Q1 2024, which indicates the project’s launch to the market (new off-plan release). Liquidity is confirmed by high activity — sales have been going actively up to the present moment.
In the rental segment, there are no officially recorded leases for the building or the project — this is typical for new off-plan properties that have not yet been handed over or where apartments have not yet entered the rental market. Overall, more than 3,500 rental contracts have been recorded in Um Suqaim Third in recent years, which indicates high rental activity in the location.
3. Sale price dynamics (building and district)
Elara 1 (all transactions, apartments):
- In Q4 2023, the average price per m² was about AED 32,000.
- In Q1 2024 — AED 30,565/m².
- A slight decrease is observed: in Q3–Q4 2024 the average figure dropped to AED 26,300–27,700/m² (although there are few transactions there), while over the last 12 months the average price for the building is around AED 31,700/m².
Um Suqaim Third (district benchmark):
- During 2020–2022, average prices per m² were in a wide range and grew significantly from AED 15,000–23,000/m² to AED 27,000–29,000/m² in 2023.
- Over the last 12 months, the average price in the district has been around AED 27,550/m².
Thus, Elara 1 is selling at roughly a 15% premium to the district average, reflecting a mark-up for the project’s newness, status and, most likely, views/concept.
4. Rental rate dynamics and level of rates
As of the analysis date, there are no registered rental contracts for the building/project ELARA — the project is new, with actual operation and entry to the rental market still ahead.
For Um Suqaim Third, the following dynamics of average annual rent per square metre have been recorded:
- In 2023, rates reached AED 1,010–1,230/m² per year (growth compared to 2022).
- Over the last 12 months, the average rate in the district has been about AED 1,239/m²/year.
In 2024, the average level remains above AED 1,200/m², which corresponds to a premium district.
5. ROI (gross and net), fair investment price range
- Actual Elara 1 sales level over the last 12 months: around AED 31,700/m².
- Average rental rate over 12 months for the district: about AED 1,239/m² (no data for the building).
Using the district benchmark, the potential yield for the area is 1,239 / 31,700 = 3.9% per annum (gross). Taking into account all initial costs (≈7%), the actual (net) yield may be around 3.6% of the purchase price at current levels.
For a calculated investment price that would correspond to a target yield of 7–8%, the “fair range” for the district would look as follows:
- For 7%: 1,239 / 0.07 ≈ AED 17,700/m²
- For 8%: 1,239 / 0.08 ≈ AED 15,500/m²
The current Elara 1 pricing (AED 31,700/m²) is almost twice these levels.
6. Conclusions
- Elara 1 is a new flagship project in a premium district, which is reflected in its list prices and high sales liquidity (sales of new apartments were active throughout the entire release cycle).
- In terms of pricing, Elara 1 is noticeably more expensive than the district average (a substantial premium for the concept, newness and project level).
- There is no rental activity in the building yet (off-plan, not handed over or only being handed over), but the district itself is consistently in demand (high rental liquidity, rapid growth in rates).
- Current sale prices are far above the levels that would provide investors with a 7–8% annual yield (even based on the district rental benchmark). Taking into account transaction costs, the actual (net) yield on an investment purchase may be below 4% per annum.
- For long-term investors, further price growth potential may be driven solely by overall market dynamics in this part of Dubai and the absence of comparable competing projects. However, one should not expect high rental yields when buying at current developer prices — Elara 1 is currently positioned more as a “lifestyle” and “capital appreciation” asset rather than a high-yield buy-to-let.
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