Case Study: Investment Performance of a 2-Bedroom Apartment in The Address Residences Sky View 2, Downtown Dubai

Property Overview

• Location: The Address Residences Sky View 2, Downtown Dubai
• Unit Type: 2-Bedroom Apartment
• Unit Size: 1,700 sqft
• Current Status: Ready
• Sold By: Individual
• Category: Residential, Apartment

Transaction History

1. Most Recent Sale:
   • Date: 12 September, 2024
   • Sale Price: AED 7,900,000
   • Price per Sqft: AED 4,647
   • Percentage Growth Since Last Sale: +67%
2. Previous Sale:
   • Date: March 2014
   • Sale Price: AED 4,742,159
   • Percentage Growth Since Previous Sale (2013): +8%
3. First Sale:
   • Date: December 2013
   • Sale Price: AED 4,390,888
   • Sold By: Developer

Rental Overview

• Current Gross Rental Yield: 5.7%
• Last Rental Amount: AED 450,000 per year
• Rental History:
  1. Current Rental Contract:
     • Start Date: February 2023
     • End Date: February 2024
     • Annual Rent: AED 450,000
  2. Previous Rental Contract:
     • Start Date: April 2022
     • End Date: April 2023
     • Annual Rent: AED 415,000
     •  

Key Insights and Analysis

Price Appreciation:
The apartment has appreciated significantly in value over the years. The property was first purchased from the developer in December 2013 for AED 4.39M and was sold most recently in September 2024 for AED 7.9M, representing a 67% increase from its 2014 sale price of AED 4.74M. This level of appreciation shows strong growth in the property market in Downtown Dubai.

Rental Growth:
The property has also seen steady growth in rental income. Between April 2022 and February 2024, the annual rent increased from AED 415,000 to AED 450,000, reflecting a 8.4% growth in rental income over that period.

Gross Rental Yield:
The current gross rental yield stands at 5.7%, which is quite attractive for an investor in this high-demand area. With the last recorded rental amount of AED 450,000 and the latest sale price of AED 7.9M, this yield offers a solid return on investment for a luxury apartment in Downtown Dubai.

Market Competitiveness:
The Address Residences Sky View 2 is part of a high-end development, and its prime location in Downtown Dubai contributes to its value retention and price appreciation. Given its central position, proximity to key landmarks, and luxury amenities, it is likely that demand for both buying and renting in this development will remain strong.

Investment Outlook:
With rising property values and increasing rental income, this apartment presents a lucrative opportunity for investors looking for both capital appreciation and a steady rental yield. The historical price growth, coupled with a solid rental yield, makes it an appealing asset in Dubai’s real estate market.

Conclusion

This case study highlights the strong investment potential of a luxury apartment in The Address Residences Sky View 2, Downtown Dubai. With significant capital appreciation of 67% since 2014 and a healthy rental yield of 5.7%, it stands as a prime example of the profitability of real estate investments in Dubai’s high-demand areas.

References : DXBInteract

Address Residences Sky View 2 Burj Khalifa - Real Estate Transaction (https://dxbinteract.com/r/property/trends/transaction-details?p155_prop_id=18034557&cs=3d3-8r8an58B9Oo-9uFEDQ6QyEqyvugCWMXUN638pMmI&dialogCs=ScLHmdilMycULFInLEKfKKOsieBCkkykmB6xiYa-r74)