As the real estate market in Dubai continues to grow quickly and we try to find popular places to invest for a good return on investment. Some market studies say that more than 48,000 houses were sold in Dubai between July and September which was around AED120bn ($32.7bn).
It is not new that property prices in Dubai's popular places have been rising for years. This is because of a good number of sales, huge demand, and the world-class amenities given by the builder. These are the things that will continue to fuel growth for the next year also. Although costs and rents are going up in several locations but Dubai Housing has found the areas in Dubai where you can get the better return on your investment (ROI) and where people are paying the most for rent.
Brokers are saying that prices for both apartments and villas have gone up in good percentage in some of Dubai's demanding areas. For example, in Q3 2024, villa costs in Arabian Ranches went up by around 13% which is high. People looking for cheap homes and those who have a property are becoming more interested in places like International City, Dubai South, DAMAC Hills 2, and Dubailand.
Several people in the middle price group have kept looking for houses in areas like Jumeirah Village Circle, Jumeirah Lake Towers, Al Furjan, and Reem. Investors in costly homes have been interested in places like Dubai Marina, Business Bay, DAMAC Hills, and Dubai Hills Estate.
The transactional prices for affordable apartments in places that get a lot of searches have gone down by up to 11%. On the other hand, the transactional prices for villas in Dubailand went up by about 20% because more people want to buy houses that look good. In the middle section, the prices of apartments and villas have gone up by as much as 8%. The prices of luxury homes have also been going up steadily, with selling prices going up by 3% to 31%. Dubai Hills Estate has seen the biggest price rises.
As we said in the start, the Dubai Land Department (DLD) and other studies show that more than 48,000 properties were sold in Q3 2024 that are worth about AED120bn ($32.7bn). If we look at the different types of properties, more than 16,000 of these deals came from the ready-to-move-in houses and were worth more than AED51bn ($13.9bn). On the other hand, more than 32,000 deals came from off-plan properties worth more than AED70bn ($19.1bn).
People who have bought apartments with attractive pricing in Dubai Investments Park (DIP), Discovery Gardens, and Liwan have said that they got more returns on their money, with rates between 9% and 11%. In the middle group like Dubai Sports City, Dubai Silicon Oasis, and Town Square all offer good returns of more than 8.6%. Places like Al Sufouh, DAMAC Hills, and World Trade Centre have given returns of 7% to 9% for modern apartments, which is more than several global markets.
When it comes to other cheap houses, DAMAC Hills 2, International City, and Serena all offer returns above 6%. ROIs starts from 6% to 9% for mid-size house communities like Jumeirah Village Circle, Dubai Sports City, and Jumeirah Village Triangle. In the luxury market, Al Barari and Tilal Al Ghaf offer returns of more than 6%, while Jumeirah Golf Estates and Al Barari also offer returns of up to 6%.
Rental prices have gone up a lot across different types of groups. The prices of cheap apartments have gone up by as much as 28%, with one-bedroom apartments in Deira seeing the bigger jump.
The rent for middle-size houses has gone up by as much as 14%, and the rent for costly apartments has also gone up, but only by 9%. In Business Bay and Dubai Marina, one- and two-bedroom apartments saw small drops of less than 4%. There have been price drops of up to 11% for five-bedroom houses in all major areas, but prices for villa rents in the attractive pricing have gone up by on average 10%.
Apartment rents in the middle group went up by as much as 42%. The most growth was seen in four-bedroom properties in Al Furjan after the houses in Murooj Al Furjan were filled up. Luxury house rents went up by 15%, with Jumeirah's small number of five-bedroom units seeing the higher jump.
People looking for small apartments have turned to Deira and International City, and people looking for new houses have turned to DAMAC Hills 2 and Mirdif. People are still looking for mid-size homes in Bur Dubai and Jumeirah Village Circle (JVC). For midsize villas, people have been going to JVC and Al Furjan.
When it comes to high price rentals, Dubai Marina and Business Bay are still the popular places to find beautiful properties, while Dubai Hills Estate and Al Barsha have been the demanding places to find other houses.
In places that are still cheap, transactional renting prices for both houses and studios have gone up by 1% to 14%. Rental prices have gone up by up to 10% in the mid-price and high-price classes. The real estate market in Dubai is currently very popular. This is because the economy is growing, there are a lot of buyers from other countries, and the tourism market is also doing very well.
Since developers are making sure that supply closely matches market demand, the sector should keep going good for another four to five years, with little chance of having too much supply. Property prices in the city are also still going up because there is a lot of desire for both luxurious and mid-priced projects.
People working in Dubai Housing are saying that Dubai's real estate market is booming, and we may see even more growth in the property market. Sales of properties are expected to rise through 2024 and 2025. A good balance between supply and demand and steady investment are two things that will keep the market going. Another thing is the rise in new practices that are changing the style of real estate deals and making them more open and comfortable.
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