Dubai Real Estate Market Report | Q3 2023

 

Key Trends

  • Rental Trends: Apartment rates ascended 16.8% QoQ and 51% YoY, while villa rentals reported a 21.9% QoQ increase and a staggering 1.3% YoY climb.
  • Luxury Segment: A 27K sqft penthouse in Marsa Al Arab clinched a deal at AED 420M, signaling sustained demand for opulence.
  • Mortgage Insights: Mortgage values shrunk by 6.6% to AED 29.3B. Contrastingly, volumes soared 58%, tallying over 36,708 transactions.
  • Investment Hotspots: Palm Jebel Ali is rapidly becoming an international investor magnet.
  • Off-Plan Dominance: Damac Lagoons retains its crown in the off-plan villa landscape.

Middle Eastern Property Market Navigates Complex Dynamics

While the property sector grapples with a global backdrop of economic shifts, the Middle Eastern market demonstrates both resilience and complexity.

Tenancy Landscape Shifts

The overall number of new tenancy contracts experienced a decline of 6.7% on an annual basis. However, a resurgence was noted in the most recent quarter, with a 22% uptick. This cyclicality underscores the region's adaptive real estate dynamics amidst broader macroeconomic changes.

Rental Trajectory

Apartments continue to find favor, marking a 16.8% increase in rentals on a QoQ basis and an appreciable 51% YoY rise. Villas, often viewed as a bellwether for luxury preferences, registered a 21.9% quarterly growth and a robust 1.3% annual leap.

Luxury Sector Momentum

Indicative of the opulence in regional preferences, a sprawling 5-bedroom penthouse, encapsulating over 27,000 sqft in Marsa Al Arab, commanded a price of AED 420M.

Mortgage Market Dichotomy

In a rather bifurcated trend, the value of mortgage transactions receded by 6.6% to a figure of AED 29.3B. Paradoxically, in terms of sheer volume, there was a sharp ascent of 58%, with over 36,708 property sales transactions being concluded.

Emerging Investment Frontiers

Palm Jebel Ali, with its strategic positioning and allure, has become a magnet for international investors, reflecting the ongoing globalization of property investment.

Off-Plan Market Dynamics

Damac Lagoons remains a formidable player, steadfastly holding its pole position in the off-plan villa segment.

Analysts remain watchful, eager to decipher how these multifaceted developments might shape the future trajectory of the Middle Eastern property sector.

Q3 2023 Dubai Real Estate Market Performance:

  •  Supply
    • 44 projects were completed in Q3 composing over 14,266 units.
    • 89 projects were registered which is the highest number of quarterly project launches.
  • Sales Volume
    • 36,708 property sales transactions
    • 43.9% increase compared to Q3 2022
  • Sales Value: 
    • AED 109.2 billion in Q3 2023
    • 57% increase from Q3 2022
  • Off-plan Properties: 
    • 22,006 recorded sales of off-plan properties.
    •  58% increase in sales volume compared to Q2 2022. 
    • Sales value for off-plan properties surged to AED 61.6 billion, showing an impressive 49.6% QoQ.
  • Ready Properties
    • There were 14,702 sales of ready properties.
    • 27% increase in sales volume compared to Q3 2022.
    • Sales value for ready properties reached AED 47.6 billion, representing a notable 27% increase from the previous year.

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