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Activity levels across the UAE’s real estate sectors have continued to record strong performance in Q3 despite rising global headwinds.
In the residential sector, average property prices in Abu Dhabi increased by 3.2% in the year to September 2022, with average apartment prices rising by 3.3% and average villa prices increasing by 2.7%, according to commercial real estate services and investment firm, CBRE
Rents in the capital’s residential market decreased by 0.5% on average in the year to September 2022, with apartment rents increasing by 0.3% and villa rents by 1.2%.
In Q3 2022, Abu Dhabi’s transactions data registered an increase of 37.5%, compared to the prior year. In the year to date to September 2022, 3,164 new units have been completed and delivered in Abu Dhabi, a further 5,516 additional units are projected to be delivered over the course of the year, CBRE said in its quarterly real estate market review.
In Dubai, average property prices increased by 8.9% in the year to September 2022, where average apartment prices rose by 8.0% and average villa prices rose by 14.3%.
Over the same period, average rental rates recorded their highest growth rate on record, with average rents in Dubai increasing by 26.6%, with average apartment and villa rents increasing by 26.7% and 25.5% respectively, CBRE said in its market review.
Taimur Khan, Head of Research – MENA at CBRE in Dubai, noted that the real estate market in UAE is going from strength to strength and will remain resilient.
“There is little doubt that we will see weakening global macroeconomic conditions impact economic activity in the UAE. However, the UAE’s fiscal position, easing of business and residency regulations over the course of the year and safe-haven status are expected to dampen the scale of the impact. As a result, we expect that given the fundamentals underpinning the market, UAE real estate activity and performance will remain fairly resilient going forward,” he said.
To date in 2022, 20,847 new units have been completed and delivered in Dubai.
A further 33,756 under-construction units are expected to be completed by the end of this year, however, we expect that some of these completions are likely to be pushed into 2023. The total volume of transactions in Dubai’s residential market reached 8,020 in September 2022, up 47% from a year earlier. In the year to date to September 2022, total transaction volumes hit the highest level since 2009, reaching a total of 63,143 transactions, which represents an increase by 56.2%. Looking ahead, we expect the rate price growth to continue to moderate on average. However, we expect that price performance in prime communities will continue to outpace the wider market.
(Writing by Seban Scaria; editing by Daniel Luiz)
