Will Property Prices Fall In Dubai 2024

The latest market report reveals a remarkable upswing in the Dubai real estate market till the end of second quarter 2023. The city has achieved yet another quarterly record, reflecting its thriving property sector. Notably, over 30,000 property transactions were recorded in the first half of the year, showcasing a substantial surge of 35% when compared to the corresponding period in 2022. These statistics highlight the significant growth and activity in Dubai's real estate market during this time.

The second quarter of 2023 witnessed a remarkable surge in the Dubai real estate market, as evident from the latest data. The total sales value for this quarter surpassed AED 91 billion, representing a remarkable increase of over 54% compared to the same period in 2022. Additionally, the value of transactions reached nearly AED 33 billion, demonstrating a substantial growth of almost 30% year-on-year.

Notably, two major projects, namely Emaar Oasis and Palm Jebel Ali, have been recently announced, attracting significant attention from investors worldwide. Among these projects, Damac Lagoons has emerged as a prominent player in the off-plan villa market, with a staggering 642 transactions valued at AED 1.8 billion. These numbers underscore the strong investor interest and demand for real estate offerings in Dubai.

Property prices in Dubai are influenced by a multitude of factors that collectively shape the market. Understanding these factors is crucial in gauging the potential for price fluctuations. Factors Affecting Property Prices in Dubai:

Supply and Demand : Relation of supply and demand impact the price of everything and property price is not an exception. 

Economic Conditions: Dubai's overall economic health, including GDP growth, employment rates, and income levels, influences property prices.

Government Policies: Real estate-related regulations, taxation, mortgage rules, and foreign ownership laws can impact property prices in both the short and long term.

Market Sentiment: Investor and consumer confidence, along with perceptions of market stability, can significantly influence property prices.

Global Economic Trends: Dubai's property market is influenced by factors like interest rates, geopolitical events, and global economic stability.

You can read more about all these factors in our blog “Factors That Will Impact The Dubai Real Estate Market In 2023”. 

So, this is all about the factors & Dubai real estate market overview. Now come to the important parts of this blog. Let’s talk about all these factors in 2023, so we can predict the future of Dubai real estate. 

The H1-2023 Dubai Property Market Reports indicate a continuing upward surge in property prices, with substantial rent increases of up to 70% in certain areas. Sales transactions in the first half of 2023 reached an impressive Dh170 billion. 

Strong demand from local and overseas property seekers, particularly for luxury and affordable properties, is driving this boom. Popular districts have witnessed price increases ranging from 1% to 17% for villas and apartments. Jumeirah Village Circle, Jumeirah Lake Towers, DAMAC Hills 2, and Al Furjan are attractive options for affordable properties, while Dubai Marina, Downtown Dubai, Arabian Ranches, and Dubai Hills Estate are favored by high net-worth investors.
 
Rental prices have also experienced significant increases, with affordable apartments and luxury apartments seeing rent hikes of up to 17% and 32% respectively. The Dubai Land Department's data reveals 60,927 residential property sales transactions worth Dh170 billion in H1-2023, underscoring the growth and demand in Dubai's property market.

According to real estate investment experts,  Dubai’s economic prospects will be supportive in 2024 too. Given below is the comparison between the global economy and Dubai economy growth expectations in 2023 - 24. 

The real estate market in Dubai has been making headlines with record-breaking investments and transactions, surpassing major international cities like London, Berlin, Geneva, Paris, and New York. And all these are not possible without favorable government policies & initiatives. These government policies and initiatives are:-
 
Tax-Free Investment: Dubai offers a tax-free environment for real estate investments, with no property, income, capital gains, rental revenue, or value-added taxes to worry about.

Visa Initiatives: Recent visa reforms, including the 10-year Golden Visa, encourage long-term investment in Dubai, allowing non-residents to make it their second home and granting entry without conditions.

Nationality for Selected Expatriates: Amendments to the citizenship law enable investors, professionals, and special talents to acquire Emirati nationality, strengthening the economy and boosting real estate demand.

100% Foreign Ownership for "Onshore" Companies: Foreign investors can now have full ownership of onshore companies, eliminating the need for a majority local shareholder and facilitating business establishment in Dubai.

REST Launch - Enhancing Transparency: The Real Estate Self-Transaction platform (REST) enables digitalization, speeding up and streamlining real estate transactions while increasing transparency.

Tightened Real Estate Marketing Rules: Stricter advertising requirements promote transparency and fairness, limiting the number of agents involved and ensuring accurate property pricing.

Property Investment Funds Law: The Property Investment Funds Law allows registered UAE funds to purchase real estate assets in restricted areas, attracting more international investors and providing cost, flexibility, and simplicity advantages.
Rise of Loan-to-Value (LTV): First-time buyers benefit from increased LTV ratios, with expats able to borrow up to 80% and UAE nationals up to 85% of the property purchase price, easing the down payment burden.

From the last couple of years, Dubai real estate has received positive market sentiments. For the year 2023 -24 market sentiment are:-

• The outlook for rated Dubai-based real estate companies remains stable, reflecting our expectation of strong cash flow, steady profitability, and improving credit metrics driven by growth.
• According to the experts, the growth rate of Dubai GDP will be 3% in 2023 - 24, with 3% inflation rate. Population of this region will also rise with the rate of 3 - 4%. As well as, the tourism industry in Dubai keeps growing. 
• Increasing interest rates, inflation, and devaluation of emerging currencies may dampen demand for residential real estate. The result will be a stabilization of residential property prices in 2023.
• Developers are set to benefit from strong revenue visibility in the coming years, driven by robust revenue backlogs resulting from strong presales in 2021-2022.
• Operators in the real estate sector will experience an increase in footfall and a growing number of international visitors. However, they face the risk of reduced spending due to prevailing economic headwinds. Rental prices will remain under pressure due to the introduction of new supply.

This is one of the serious concerns of real estate  investors & home buyers in Dubai, especially for the foreigners & expats.
 
Yes, it is true that the global economic condition is improving but recovery speed is not so good. If we talk about the global recovery rate then, in the starting of 2023 the average rate has decreased from 3.3% to 2.7%, but in 2024 expected to reach 2.9%. In 2024  Due to tight fiscal and  financial conditions, the GDP of the USA is expected to slow down to 1%. But as expected, China, a rising global superpower is going great with the rate of 5.4% in 2023 and expected to touch the figure of 5.1 in 2024, thanks to the strict policies.

Across the world, the housing market is experiencing signs of recession, but in Dubai, it is running at an accelerated pace.  In Dubai, the property market witnessed record-breaking sales as properties were swiftly bought, indicating a notable upward trend. Residential property demand in Dubai has led to increasing property prices, particularly in apartments and villas, driving the growth of the real estate sector in the city. 

So, the answer is Dubai Property Price Will Not Fall in 2024 and this is the best time to buy property here.  The favorable market conditions and Dubai growing reputation as a tourism hub make your decision of buying property here perfect.  As we have seen in this blog, the Dubai property  market has shown substantial growth over the past few years, and this trend will continue in 2024.  Demand for property in Dubai is very high and supply is very limited if we only consider top real estate developers like Emaar, Damac , Sobha, Danube , and Nshama etc. So  you can expect a rise of 20 - 25% annually in property price. 

If you are also planning to invest in Dubai Real Estate or looking for a luxury home in 2024 then Dubai Housing can help you.  We are the channel partner of top real estate developers in Dubai and assuring smooth buying process & after sales services. 

The Dubai real estate market has experienced excellent growth in 2023 and is expected to continue in 2024. There are many factors too that indicate record-breaking sales, growing demand, and rising property prices indicate a thriving market condition. Economic prospects are supportive, with projected GDP growth of around 3% in 2023 and positive sentiment from population growth and tourism recovery. Favorable government policies and improved transparency through tightened marketing rules and the Real Estate Self-Transaction platform further contribute to the market's appeal. As a result, property prices in Dubai are anticipated to continue rising in 2024, with annual increases of 20-25%.