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Just three months into 2023, Dubai's red hot property market has net new records for transaction volumes as the global buyers and investors continue throng to the glitzy city.
In the year to date to March 2023, the total transaction volume reached 29,323, which is the highest total ever registered during the first quarter of the year, according to real estate adviser CBRE Group Inc.
During the period, 11,597 residential transactions were registered in Dubai, the highest monthly total ever recorded, marking a growth rate of 47.3% compared to the year prior. This increase has been supported by a 96.1% growth in off-plan market transactions and a 12.4% increase in secondary market transactions.
Having bounced back from a slump in 2020 on the back of visa reforms and investor friendly policies, Dubai is one of the fastest growing markets globally. Although still significantly cheaper than real estate in New York or London, prices and rents ballooned last year as demand from global investors surged. The invasion of Ukraine led to Russian nationals, who looked to ring fence their wealth from Western sanctions, move out of their country. Dubai is among their top destinations. In addition, Chinese investors who stayed away during the pandemic, are moving to the city as are crypto millionaires from Europe, and businesses looking to avoid high taxes and painful inflation levels.
The CBRE report showed average residential prices in Dubai have increased by 12.8% in the year through March 2023, with average apartment prices increasing by 12.4% and average villa prices by 14.8% over the same period.
As of March 2023, average apartment prices stood at AED 1,234 per square foot and average villa prices stood at AED 1,455 per square foot.
Jumeirah has recorded the highest sales rate per square foot in the apartment segment of the market, reaching AED 2,441, whilst Palm Jumeirah has recorded the highest sales rate per square foot in the villa segment of the market, reaching AED 4,457.
Surge in rents
Average residential rents have jumped over 26% in the year to March, CBRE said. The average apartment rents rose by 26.3% and average villa rents by 26.2%. As at March 2023, the average yearly apartment and villa rents have reached AED 101,044 and AED 300,984, respectively.
The highest average apartment and villa rents have been registered in Palm Jumeirah, where average rents reached AED 264,537 and AED 1,000,489 per annum, respectively.
(Reporting by Brinda Darasha; editing by Seban Scaria)
