Even though Oman property is experiencing a strong start as an international investment market, the maturity of the GCC’s prime real estate market endures.
Omani investors are not only enticed by the familiarity but also by the remarkable performance and potential for lucrative returns offered by Dubai’s property market. With its strong and dynamic economy, coupled with a thriving real estate sector, Dubai consistently secures its position among the top-performing property markets worldwide.
In fact, it is estimated that Omani investors already own around USD 1 billion worth of Dubai property.
As Oman continues its own path of economic diversification and ambitious initiatives like the Emirates-Oman rail network, Omani investors are actively seeking opportunities beyond their home market and they view Dubai’s vibrant economic landscape and promising growth prospects as both a fertile destination and inspiring blueprint.
In recent years Oman has followed a similar real estate path to Dubai.
Current performance of the Omani property market
Following in Dubai’s footsteps
Oman’s real estate market is experiencing steady growth, driven by a range of factors that mirror the successful strategies employed by Dubai. A stable political and economic environment offers a clear and attractive outlook for investors.
Government policies and plans are heavily focused on developing infrastructure, expanding housing projects, and attracting foreign investment – key components that have also underpinned Dubai’s real estate boom.
Lower property prices in Oman compared to other Gulf countries make the market particularly appealing for investors seeking high returns on investment. The growing demand for housing and commercial properties in key cities like Muscat further propels this growth.
Additionally, laws passed in 2021 allow expatriates to purchase homes through Oman’s usufruct scheme using bank loans, facilitating greater investment opportunities. Oman’s efforts to emulate Dubai’s real estate investment success are evident in these strategic initiatives aimed at fostering a vibrant and lucrative property market.
In Q3 2024, Dubai’s property market showcased exceptional resilience and growth, standing out as one of the strongest performers globally. This is in contrast to Oman’s emerging real estate sector, which, while showing steady growth, lags behind in several key areas.
Volume and scale
According to the Dubai Land Department (DLD), the total sales value in Dubai’s real estate market reached AED 141.95 billion, representing a remarkable 30% year-over-year increase. This robust performance was driven by both off-plan and ready properties, reflecting the market’s versatility and broad appeal.
Dubai recorded an impressive 50,425 transactions, a 38% year-over-year increase, underscoring the high demand for real estate in the emirate. The rental sector also saw significant activity, with 46,000 new rental contracts signed, highlighting the strong demand for residential properties.
Exceptional ROI
Both main residential asset types – apartments and villas – generated strong year-on-year capital appreciation, with apartments recording a 19% rise and villas seeing an even more impressive 23% increase. Additionally, the rental market showed substantial growth, with average apartment rents rising by 19% and villa rents by 13%. This impressive performance translates to rental yields of approximately 8%, further enhancing Dubai’s attractiveness as an investment destination.
Investors will note the two GCC partners are continually exploring and collaborating to create opportunities for both nations to capitalise on sector potentials and foster sustainable growth.
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