Dubai’s residential property market experienced a remarkable growth spurt in June 2023, surpassing last year’s figures by 18.8 percent. Deals volume soared to 9,876 during this period.
Interestingly, off-plan deals showed extraordinary growth, skyrocketing by 44.9 percent. However, the secondary market experienced a minor decline of 0.5 percent.
Remarkably, the first two quarters of the year witnessed a total of 57,737 residential transactions, marking the highest recorded number thus far.
As quoted by Arabian Business, Taimur Khan, CBRE’s Head of Research – MENA, highlighted the strengthening price growth in Dubai’s residential market over the past few months.
From January to June 2023, average prices across the city increased by 16.9 percent, with apartments and villas witnessing rises of 17.2 percent and 15.1 percent, respectively.
This impressive growth is fueled by heightened activity levels, resulting in the highest deals ever recorded midway through the year, reaching 57,737 transactions.
Khan also noted that nearly all of the communities monitored by CBRE have experienced price growth in apartments (97.1 percent) and villas (96.8 percent) compared to a year ago. Prime and key residential areas are enjoying elevated demand and significant price appreciation.
Since late 2014, average prices have shown a strong upward trend, increasing by 16.9 percent in the year leading up to June 2023, up from the 15.9 percent growth observed a month earlier. During this period, average apartment prices surged by 17.2 percent, while average villa prices rose by 15.1 percent.
Although average apartment prices in Dubai remained below 2014 levels, with an average of AED 1,294 per square foot, several communities have already surpassed their previous peak levels. In contrast, average villa prices reached AED 1,525 per square foot, exceeding their 2014 figures by 5.5 percent.
Downtown Dubai emerged as the most desirable area for apartment sales, with prices reaching AED2,440 per square foot. Meanwhile, Palm Jumeirah claimed the top spot for villa sales, with prices reaching AED 4,845 per square foot.
In the rental market, average rents experienced a significant increase of 22.8 percent in the year leading up to June 2023, although slightly lower than the previous month’s surge of 24.2 percent.
During the same period, average apartment rents grew by 22.7 percent, while villa rents rose by 23.1 percent. Presently, apartments have an average annual rent of AED 104,685, while villas command an average annual rent of AED 14,552.
Palm Jumeirah stands out as the location with the highest average annual apartment rent, reaching AED 58,335. Conversely, Al Barari leads the villa segment, with an average annual rent of AED 1,042,931.
Looking ahead, Khan anticipates a softening rental market trend. Rental growth rates in major areas are expected to stabilize, leading to reduced asking rents for many listings within these communities.
