Dubai real estate market in Q1 2024

Sustained economic growth and strong demand in the first quarter of 2024 has confirmed the resilience of the real estate market in Dubai and its attractiveness to investors and residents. These positive trends continue to make the emirate a favourable environment for real estate investment.

According to the quarterly Property Finder report, Dubai's residential and commercial real estate market in Q1 2024 saw continued growth.

Demand for both purchases and rentals of residential and commercial real estate is on the rise. The Dubai real estate market saw a 17% year-on-year increase in the number of sales transactions in Q1 2024. While in 2023, 31K transactions were made during this period – this year, 36K+ deals were recorded. The total value of transactions increased by 30% and amounted to nearly AED 115.6B (USD 31.476B).

At the same time, there was also significant growth in the ready real estate sector, with 19.6K registered deals. This indicator is 30% higher compared to the same period last year. In value terms, there was an increase of 46% - AED 78.2B (USD 21.29B) compared to AED 52B (USD 14.16B) in Q1 2023.

Off-plan deal volume increased by 4% YoY, with a total of 16.6K deals, with value growing by about 5% to AED 37.4B (USD 10.18B).

Over the last decade, the volume of deals in both number and value has nearly tripled. While the real estate market saw volatility spikes in Q1 2023, the first quarter this year has witnessed a smooth growth in demand without any sudden surges or drops.

Such trends are supported by population influx, tourism development, economic growth, government initiatives and enhanced transportation infrastructure. New metro lines, roads and interchanges are being built.

By April 2024, the average transaction value for all types of real estate had increased. The largest growth was recorded in the prices for villas and land plots. This is due to the growing number of families with children moving to the emirate, as well as the demand for luxury real estate from high net-worth individuals (HNWIs) from around the world. During the first quarter, 105 residences were sold for over AED 36.5M (USD 10M) each. The total value of such transactions amounted to AED 6.35B (USD 1.73B), which is 6% higher when compared to Q1 2023.

Given the increasing demand for high-end properties, developers launched an array of luxury projects in Q1 2024. These include Armani Beach Residences by Arada, Mercedes-Benz Places by Binghatti Properties, Altitude by DAMAC Properties and de GRISOGONO, among others.

The volume of real estate sale/purchase transactions increased in terms of both quantity and value relative to the same period in 2023, while the demand for off-plan and completed properties was nearly the same.

Residential real estate purchases comprised almost 90% of total real estate transactions, with the highest demand being for apartments, increasing almost 25% relative to Q1 2023. Conversely, demand for villas decreased by 9.4%. Commercial deals accounted for just 2% of the total volume of transactions due to their limited supply.

As a business and tourist hub, Dubai attracts businessmen, expats and those relocating from within the UAE. In regards to expats, the emirate is ranked the 9th most popular destination in The Global Expat Index, fueling the numbers of tenants and leading to a rapid rise in real estate rental values. In Q1 2024, the average rents for apartments and villas rose 20% and 15.8% respectively. Apartments are in demand for both long-term and short-term rentals, whilst villas are popular with families with children.

Following the changes to the RERA Real Estate Rental Index and the announcement of new value adjustment rules, rental values are expected to increase by 10-20%. Alongside lower mortgage rates, such trends may lead to a further increase in demand for real estate.

The rental value for commercial real estate increased by 43.5% over the year and averaged AED 55.1K (USD 15K ) per year. In Dubai, demand for commercial real estate is growing due to low supply and strong competition, opening up lucrative opportunities for investment.

Metropolitan Group has been showing a tremendous performance in the property market since its establishment in 2008. In Q1 2024, it received the prestigious Feefo Platinum Service Award, Best Real Estate Agency Single Office Arabia at The International Property Awards and took the sixth spot in the UAE's Best Workplaces ranking.

Metropolitan Group was also honoured with a host of awards from property developers:

The company cooperates with leading developers to provide clients with the best offers in the market. According to Metropolitan Group's results for Q1 2024, Emaar Properties’ real estate was the most popular among the agency’s clients. The company conducted over 33% of transactions with properties by this developer. DAMAC Properties was second with 15.47% of deals. Finally, Sobha Realty ranked third with over 6% of property transactions.

The majority of Metropolitan Group buyers favoured the off-plan market - 51.4% of the total number of deals was conducted in this segment. 30% of the deals accounted for secondary real estate, whilst 18.6% went for rentals. Palm Jumeirah and Dubai Creek Harbour were among the most sought-after locations for property purchases.

The company's excellent results demonstrate its development and confirm Metropolitan Group's status as one of the leading agencies in the UAE property market.