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The United Arab Emirates (UAE) real estate market has surged to remarkable heights in the third quarter of 2023, as reported by Property Finder, a leading property portal in the MENA region. Both Dubai and Abu Dhabi showcased substantial growth, with a surge in demand for off-plan and existing properties, painting a robust picture for the sector.
In Dubai, the real estate market witnessed record-breaking numbers. The Mo-asher Dubai Sales Price and Rental Performance index, a collaboration between Dubai Land Department (DLD) and Property Finder, revealed soaring quarterly indices for sales. The overall sales index hit 1.554, with a notable increase in both apartment and villas/townhouses categories. Year on Year (YoY), this represented a significant 12.4% surge from Q3 2022 to Q3 2023.
For rentals in Dubai, the market displayed an improved environment, with the overall rental index standing at 1.08, indicating a positive shift compared to previous quarters. Notably, the city recorded a staggering 22.76% increase in property transactions, totaling 31,181 transactions in Q3 2023 compared to 25,400 in the same period in 2022, marking the highest quarterly peak in ten years.
Meanwhile, in Abu Dhabi, the Department of Municipalities and Transport (DMT) reported a substantial surge in total sales transactions for both residential and commercial properties in Q3 2023. Residential transactions skyrocketed to a record high of 3,718, showcasing a 137% increase from Q3 2022, comprising around 92% of the total transactions and 90% of the overall value.
The surge in off-plan transactions played a pivotal role in driving long-term growth in both cities. In Dubai, off-plan properties contributed to 47.2% of total transactions in Q3 2023, reaching 14,714 transactions, marking a 24.6% increase from Q3 2022. The sales value for best off-plan projects in Dubai soared to AED 35.71 billion, witnessing a 46.72% increase and contributing significantly to the total transaction value.
Abu Dhabi’s off-plan market exhibited similar trends, with a staggering 184% increase in volume and a remarkable 367% increase in value compared to Q3 2022. The off-plan sales transaction value in Q3 2023 contributed to 87% of the total sales transactions value, reaching AED 12,713 billion compared to AED 2.72 billion in the same period last year.
Amidst the surge in off-plan transactions, existing properties continued to play a vital role in the market’s positive trajectory. In Dubai, existing/ready transactions accounted for 52.8% of the total sales transactions, showcasing a YoY increase of 21.2%. Transaction values hit an all-time high of AED 61.8 billion, marking a significant 37.3% increase from Q3 2022.
Abu Dhabi’s existing/ready market sales also displayed notable growth, with a 45% increase in transactions compared to Q3 2022. Transaction values reached AED 1,873 billion in Q3 2023, a 25% increase from the same period in 2022.
The rental market in Dubai witnessed a surge in contracts, with a YoY increase of 11.2%, totaling 156,422 contracts in Q3 2023. Specific areas in both Dubai and Abu Dhabi emerged as top choices for owning or renting properties, including Dubai Marina, Downtown Dubai, Business Bay, Palm Jumeirah, Al Reem Island, Yas Island, and Al Raha Beach, among others.
Cherif Sleiman, Chief Revenue Officer of Property Finder, expressed optimism about the market’s progress, citing increased uptake in off-plan projects in Dubai and rising demand for ownership. He emphasized the commitment to monitoring market trends to enable better decisions for property seekers through data-backed transparency.
Overall, the Q3 2023 report underscores a robust and thriving real estate market in the UAE, propelled by increased transactions, growing investor confidence, and sustained interest from property seekers in both Dubai and Abu Dhabi.