In the first quarter of 2024, the Dubai residential real estate market experienced unprecedented growth, driven primarily by an increase in off-plan property sales, as detailed in Savills' latest report. Q1 saw a 73% rise in off-plan sales compared to the previous quarter, which made up 63% of the overall market transactions.
Andrew Cummings, head of residential agency at Savills Middle East, gave emphasis to the continued ascent of Dubai's real estate market, attributing it to factors such as population growth, economic stability, business confidence, and the bustling tourism and hospitality industries.
Overall property transactions soared by 35% from the previous quarter, reaching a new peak of 35,100 units. Apartments were the most in demand, comprising 83% of all sales, while villas made up the remainder.
The market saw a concentration of activity in southeast Dubai, particularly in micro-markets like Jumeirah Village Circle, Arjan, Dubai Hills Estate, Meydan One, and Damac Hills 2. Key areas such as Business Bay, Downtown Dubai, Dubai Marina, and Jumeirah Lake Towers also saw sustained demand.
Approximately 5,000 new units were introduced to the market in this quarter alone. High-profile project launches included Mercedes-Benz Places, Claydon House by Ellington, Franck Muller Aeternitas Tower in Dubai Marina, and Vida Dubai Hills by Emaar, with apartments accounting for 84% of these new additions, signalling robust confidence in this segment moving forward.
Property sales in Dubai exceeded the $2.7 million mark, with over 1,000 transactions reaching or surpassing AED 10 million, marking a 41% increase from the previous year. Luxury apartment transactions saw a 51% increase quarter-on-quarter.
Leading locations for upscale apartment prices per square foot included The Palm Jumeirah, Business Bay, and Bluewaters Island, whereas Dubai Hills, Palm Deira, District One, and Tilal Al Ghaf posted the highest rates for villas and townhouses.
Rental rates across Dubai increased by an average of 7%, with apartment rents rising by 8% and villas by 6% from the previous quarter. With a revised rental index in place, some areas might see rent increases of 10% to 20%, which could encourage tenants to consider relocating, downsizing, or purchasing properties.
Cummings remains optimistic about the near future of Dubai’s residential real estate market, anticipating continued growth in both rental and capital value appreciation.
Original article reference: Arabian Business.
