The year 2022 showed positive momentum in property price growth and rental prices in Dubai. Last year, residential rentals and transactions in the emirate hit record highs amid high demand for property from investors around the world. Dubai is a popular destination for property acquisition due to its exceptional security, business-friendly environment, diverse investment opportunities, and much more.
In 2022, the real estate market in Dubai developed strongly and real estate transactions hit a record high. According to a CBRE report, 90,881 property transactions were registered in the UAE. Earlier there was another record – 81,182 transactions in 2009. Real estate transactions in Dubai exceeded AED 500 billion (US$ 136 billion) in 2022. Off-plan home sales were up 92.5% and second home sales were up 32.4%. The end of last year also showed high numbers: more than 8,500 deals for December, which corresponds to an increase of 63% compared to the previous year.
READ: Cost of Living in Dubai: Updated Information for 2023
The most desirable areas for the first half of the year were waterfront communities, including Palm Jumeirah. Real estate prices in this area rose mainly due to high demand and low supply.
Investing in beachfront property in Dubai is a worthwhile venture, given the high demand among tourists for seafront properties. Some of the best projects in the emirate, offering beachfront apartments, include Six Senses Residences, AVA by Omniyat, and Emaar Mina Rashid.
Significant growth has been observed in green neighborhoods like Hadaeq Sheikh Mohammed Bin Rashid Part 2. Prices in the quarter increased by 53% and averaged AED 1,600,000 (US$ 436,000). This type of community attracts families with children who prefer living in areas with canals and parks.
In 2022, average property prices in Dubai increased by 9.5%. The cost of apartments went up by 9%. At the same time we can notice that villas experienced a significant increase of 12.8%. In January 2023, the average apartment price in Dubai was AED 1,168 (US$ 318) per square meter, and the average villa price was AED 1,385 (US$ 377) per square meter.
The Jumeirah area recorded the highest residential sales rate in the market at AED 2,324 (US$ 633) per square meter. The popular Palm Jumeirah area also saw the highest sales rate in the villa segment, reaching AED 3,921 (US$ 1,067) per square meter.
According to CBRE, indicators of growth in housing rents reached record levels. Here prices increased from 24% to 27%. At the end of last year, the average annual rental price for apartments was AED 95,000 (US$ 26,000), and the average rent for villas was AED 282,000 (US$ 77,000).
READ: Bahur and Ud: Enchanting Fragrances of the East
Last year, the desirable Palm Jumeirah area achieved the highest average annual rental prices. Rents here averaged AED 248,000 (US$ 68,000) for apartments and AED 1,017,000 (US$ 277,000) for villas per year.
Last year, there was a significant stream of investors, as 80,216 investors registered 115,183 new property investments with a total value of AED 264.15 billion (US$ 72 billion). Additionally, the number of investors increased by 53%.
In 2022, Russian citizens bought the most property in Dubai, accounting for 15% of all transactions. British and Indian buyers were also on the list with 12% and 11%. Despite a massive geopolitical crisis across the world, the emirate experienced the largest inflow of private wealth. In the first half of 2022, over 16% of Russian entrepreneurs and companies relocated to the UAE, including Dubai. The local real estate market also benefited from the 2022 World Cup in Qatar. Dubai’s status as a ‘financial hub’ and the region’s primary tourist attraction made it the main beneficiary outside of Qatar.
The Emirate of Dubai is one of the most desirable investment cities in the world. The reason is its strong financial base, economy, and promising growth prospects.
CBRE forecasts positive average rates of property prices and rental growth in Dubai this year. The emirate’s real estate sector is expected to grow by 46% in 2023. Experts predict the construction of 30,000-35,000 new residential objects in the nearest future.
The Strategic Plan 2026, aimed at establishing Dubai as one of the best real estate markets globally, was announced in 2023. The plan focuses on providing new real estate solutions, encouraging innovation, and creating a data-driven sector to ensure investment security. Emphasis will also be on implementing global standards in the real estate market.
READ: Why Should You Book Half Board at The Palm Jumeirah: Important Info for All Guests of Dubai
Experts predict an trend in the real estate market in Dubai for 2023, local prices expected to increase by at least 10-15%. Underrated districts with low real estate prices are expected to experience significant growth. For instance, in 2022, prices in the vibrant Jumeirah Village Triangle area increased by 62%, with the average property cost reaching AED 731,000 (US$ 199,000). Property prices in this quarter are expected to increase by 29%.
