End-users Continue to Rise in Dubai Property Market

End-users Continue to Rise in Dubai Property Market

According to a report, there was a continuous growth in the end-user base in the property market in Dubai in 2023. Buyers who identify as end users increased to 44% from 38%.

The Dubai real estate market report from Betterhomes for FY2023 revealed that the total residential sales transactions in the emirate were 120,742.

This was a 38% increase from the previous record that had been established in 2022 of 87,454. The report revealed that apartment sales were mostly responsible for the increase.

This is because they had recorded an increase of 49%, thereby reaching a total of 94,155.

The growth

There was a more modest growth in the townhouse and villa segment, as they recorded a 9% growth to 26,587, mostly because key communities had a lack of supply.

Majority of the growth in transactions that was seen in 2023 was because of off-plan sales, as they recorded a year-on-year increase of 48%.

Due to this, off-plan sales made up most of the residential real estate sales, as the rose to 54% from 48% of total transactions.

The sale of apartments contributed to this growth, as they recorded a growth of 63% year-on-year and were 87% of the total transactions that had taken place in the off-plan market.

Other markets

There was a 21% increase in transactions in the secondary market. There was a 32% increase in the sale of apartments, while a 3% growth was recorded in the sale of ready townhouses and villas.

The growth in the villa market continued, as many buyers were moving towards more affordable and readily available apartments due to high purchasing costs and stock restrictions.

In 2023, the total value of property sold in Dubai reached AED 322 billion, which was a year-on-year increase of 52%. This was higher than transactional growth, which highlighted the rise in prices.

Overall, there was an 18% increase in prices in Dubai in 2023, which was higher than the 11% increase that had been recorded in 2022.

The report noted that average prices had reached a record high due to this increase and it was over 3% higher than the previous market peak that had been seen in September 2014.

The recent trends

The secondary market has recently seen a dampening in price increases and demand due to higher interest rates.

The report said that if interest rates fall sometime this year, then mortgages would become more affordable and this would increase buyer demand and put upward pressure on prices even more.

The luxury real estate market in Dubai had a record-breaking 2022 and it was able to maintain its momentum in 2023 as well.

Transactions valued at more than AED 15 million had recorded an impressive growth of 89%. Wealthy attractors have been attracted to Dubai from all over the globe.

This is due to a favorable tax regime, the relative affordability of luxury homes in the emirate, the lifestyle and appeal of long-term visas.

In 2023, a total of 4,500 millionaires were expected to have moved to the United Arab Emirates.

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