Dubai's property market is witnessing a transactional boom with sales exceeding AED 353.7 billion, a staggering 53% increase year-over-year as of early November. The volume of property deals has also seen a notable 38% surge, with over 116,400 transactions recorded, signaling a bullish market despite global economic uncertainties.
Breaking down the components of this growth, the ready property market has realized a 42% YoY leap in sales value, achieving AED 214.3 billion across 56,000 transactions. This sector's per-square-foot price rose by 10% to AED 1.1K, reflecting a solid demand for immediate occupancy.
Concurrently, the off-plan segment, though seeing a higher YoY sales value growth of 74% to AED 139.4 billion, has undergone a slight price softening, with a 1% decrease in per-square-foot price to AED 1.7K. This dip could be indicative of market corrections or an increased supply in the pipeline.
Mortgage transactions have bucked the upward trend with a slight 5% decline in value, although the number of deals has jumped by 38%, pointing towards a possible shift in buyer financing strategies.
In terms of hotspots, Jumeirah Village Circle and Dubai Marina lead in transaction volumes, with the latter commanding higher total sales value reflective of its premium positioning. Business Bay and Dubai Creek Harbour also feature prominently in the transaction tally, indicating a diversified interest across the emirate.
Rental yields have escalated notably in October 2023 with apartment and villa rents rising by 16.7% and 22.8% YoY, respectively. Contrarily, apartment sales prices have decreased by 24.4%, whereas villas and commercial spaces have seen price escalations of 23.6% and 36.2%, respectively, suggesting a shift in consumer preferences or investment strategies.
A highlight transaction of the period was the sale of luxury villas on The Palm Jebel Ali, totaling AED 5.8 billion, underscoring the enduring allure of high-end properties. However, the off-plan market has exhibited signs of cooling with a significant downturn in transaction volumes over the past two months.
As the market moves into the latter part of the year, the robust year-to-date Dubai real estate performance reflects investor confidence and the sustained appeal of Dubai's property sector. The variations within different segments and asset types suggest a nuanced market response to broader economic factors and localized demand-supply dynamics. The decline in off-plan sales volumes could signify market saturation or a cautious investor sentiment in anticipation of potential shifts in economic conditions.