Dubai’s property market has experienced a remarkable 30% surge in 2024, driven by high rental yields, accessible financing, and residency visas. The first half of the year saw a significant influx of foreign buyers, absorption of existing inventory, and a movement into suburbs, according to real estate firms.
Post-New Year Stability and Rising Prices
After a period of stability in early Q1 2024, property prices in Dubai’s most sought-after areas have risen again, dispelling any speculations of a slowdown. Despite the price increases, Dubai remains highly affordable compared to other luxury real estate destinations, attracting new and institutional investors. Bayut’s latest report highlights strong interest in affordable areas like International City, Dubai South, DAMAC Hills 2, and The Valley by Emaar. Mid-range properties in Jumeirah Village Circle, Jumeirah Lake Towers, Al Furjan, and The Springs have also seen heightened interest, while luxury investors focus on Dubai Marina, Business Bay, Arabian Ranches, and Dubai Hills Estate.
Record Growth in Sales Volume
In H1 2024, Dubai’s property sector reported a year-on-year volume growth of over 30%, with May marking a record-breaking month for sales transactions. Property Monitor noted a 47.7% month-on-month increase and a 45.9% year-on-year rise in sales volumes. Haus & haus also reported their best performing month in May, likely due to delayed transactions from April caused by unprecedented storms and flooding in Dubai.
Rising Demand for Villas
As Dubai’s population grows, the demand for villas continues to surge. H1 figures from Property Monitor indicate significant volume growth for villas, driven by residents seeking family-friendly, long-term living options. Developers have responded by launching 3,323 villas in H1, many expected to be completed by 2028. Emaar announced key master community projects, including The Oasis, The Heights Country Club and Wellness, and Grand Polo Club & Resort, attracting strong investor interest.
High Demand for New Real Estate Projects
More than 80% of new property units launched in Dubai since 2022 have sold out, reflecting high demand for off-plan projects. Dubai Land Department data shows nearly 214 projects launched, with 148 currently active. Taimur Khan, head of research for CBRE in the Middle East, noted that despite concerns about oversupply, new stock absorption remains high, with at least 70% of units launched since 2022 sold to date.
Trends for Buying Properties in Dubai
Bayut’s data indicates significant price increases for apartments and villas in prominent Dubai neighborhoods. Villas in The Valley by Emaar saw the highest increase at 17% during H1 2024. Mid-tier apartments in Jumeirah Lake Towers experienced price growth between 12% and 40%, while mid-tier villas observed increases between 4% and 23%. Luxury properties saw price increases ranging from 5% to 24%.
Record Transaction Volumes
Bayut reported 43,075 property sale transactions in H1 2024, totaling Dhs122.9bn in value for both residential and commercial properties. CBRE data shows a shift in transaction price brackets, with a notable decline in transactions below Dhs1,000 per square foot and significant growth in higher price brackets.
Changing Buyer Preferences
Taimur Khan highlighted a trend of buyers shifting away from Dubai’s core and prime areas. Senior research analyst Tatiana El Bazi noted increased interest in non-central locations.
Trends for Renting Properties in Dubai
Projected rental yields indicate strong ROI potential in areas like Dubai Investments Park and Discovery Gardens. Mid-tier apartments in Dubai Sports City, Dubai Silicon Oasis, and Motor City offer yields surpassing 9%. Luxury apartment locations like Green Community, Al Sufouh, and DAMAC Hills show returns up to 9%.
Increase in Rental Prices
Bayut’s analysis shows rental prices have increased across segments, with affordable apartment rentals surging between 4% and 31%. Mid-tier apartments saw upticks up to 15%, and luxury apartment rentals increased up to 7%. Budget villa rentals rose by 12%, mid-tier by up to 15%, and luxury villa rentals surged by up to 27%.
Who is Buying in Dubai?
The data reveals a surge in demand for both apartments and villas, with significant increases in transaction prices and volumes. British investors led the market, followed by Indians, Chinese, Lebanese, Canadians, French, Italians, Dutch, Pakistanis, and Turkish buyers.
Image Credit: Bayut
Source: Gulf Business
