Dubai Real Estate: a Thriving Market with Unmatched Potential

• The real estate market recorded more than 189,187 sales transactions worth over 521 billion AED, surpassing all previous records. The value of sales in one quarter alone reached 147 billion AED, which is also likely the highest quarterly performance ever recorded.
• The market saw 36% more transactions and 27% more in transaction value year-on-year (YoY). With new home purchases and off-plan sales culminating in over 110,000 transactions for the previous year, the resale market also rose to an unprecedented figure, with 61,200 sales, a 21% YoY value increase.
• Off-plan project sales were up 58.7% YoY, reaching 147 billion AED. Prices then followed, with a 10% increase, up to 50%, and surpluses increasing from 1,600 AED. As the city continues to grow, it seems increasingly that mid-range and suburban developments (Dubai South, Mohammed Bin Rashid City) are located further away from the ‘traditional’ hotspots of Downtown Dubai, Business Bay, and Marina.

Demand Drivers: Population Growth and International Migration

• Demand has continued to be driven by population growth and international migration. The daytime population in Dubai currently stands at 5.2 million, including residents, tourists, and residents of other Emirates. That number is expected to grow to between 6.8 and 7.5 million by 2030.
• According to estimates, the population boom will result in demand for 37,600 to 87,700 new homes per year, equating to 350,000 additional freehold apartments by 2030. However, due to construction constraints and delays, only about 35,000 homes per year are expected to be completed.

Developers have invested heavily in their existing developments, making it unlikely they will begin more than 45,000 new apartment buildings. With such limited supply, prices in both primary and secondary markets are expected to rise. New developments such as Dubai Creek Harbour, The Valley, Dubai South, Mina Rashid, Dubai Maritime City, Palm Jebel Ali, and Dubai Islands have emerged.

Another strong motivator is tourism. Dubai, the most visited city in the world, attracts 25 million visitors annually. In the last few months, they welcomed over 20 million tourists, with the highest incoming traffic coming from the UK, India, France, GCC countries, and the US. Within five years, projections indicate tourism could approach 44 million annually, doubling demand for vacation homes and rental properties.

Dubai International Airport (DXB) has managed to remain one of the busiest in the world, and it is set to surpass its passenger number record of 89 million. Al Maktoum International Airport, when completed, will be a boon not just for millions of visitors to the southern reaches of Dubai, but should also further boost real estate values in the area.

The hospitality industry is thriving, with over 821 hotels in the region achieving an overall 75% occupancy rate. Strong demand for premium properties is fueled by short-term rental yields and luxury tourism

High-net-worth individuals (HNIs) and ultra-HNIs are flocking to investments in Dubai. The city created 6,700 new millionaires in one year, surpassing traditional havens like the US and Singapore. Projections indicate a 78% surge in centi-millionaires (those with a net worth of $100M+) in the next 10 years, potentially the world's highest growth rate. Top investor nationalities include Indians, Brits, Chinese, Canadians, French, and Americans. Dubai offers tax-free investment, political stability, and some of the highest per capita incomes in the world.

Dubai's real estate stands as a testament to strategic vision and global appeal. With record-breaking transactions, surging populations, and robust tourism, it presents a compelling investment landscape. Its blend of luxury, stability, and growth solidifies its position as a thriving market with unmatched potential. To always be linked with the most reliable and credible insights on Dubai, you can reach out to Dubai Housing.