By Binesh Babu Panicker
Dubai always writes its own script when it comes to the trends in its real estate market. It happened many a time in the past and it’s happening again now. When the world is going through a turmoil due to a number of reasons, Dubai’s real estate market is going through a phase of unprecedented growth, breaking some old records and creating new ones. According to the latest report by CBRE, the overall transactions in the residential market recorded a growth of 33.4% compared to the same period in the previous year.
Highest short time growth since 2009
What stands out is the fact that this kind of growth in a short period of time was registered previously way back in 2009. During the period from January till September 2022, transactions in the off-plan and secondary sales market went up by 51.4% and 17.3% respectively. The number of transactions during this period was 62,396. This growth is quite commendable because during the past 12 months till September 2022, residential property prices rose by 8.9% overall. While apartment prices increased by 8% during this phase, villa prices went up by 14.3%. According to the report by CBRE, the average apartment price is in the range of AED1,133 per square foot, while for villas, it’s about AED1,350 per square foot. What’s interesting to note, though, is that the average price growth both for villas and apartment is still below the rate recorded in late 2014, when the price surge for apartments and villas was 23.8% and 6.6% respectively.
Residential prices: Jumeirah and Palm Jumeirah lead the way
While these two areas have always been in demand, since the beginning of this year, they have been consistently attracting more and more buyers in the apartment and villa segments, respectively. Jumeirah stood out from the rest of the apartment segment with the average prices rising to AED2,156per square foot, while Palm Jumeirah topped the list in the villa sector with an average per square foot price of AED3,597.
Rents rising
Not surprisingly, rents have also been experiencing a steady growth during the same period. Until September this year, the average growth of rentals was 26.6% and counting. The average apartment rents went up by 26.7% while the average rents for villas increased by 25.5%, a considerable growth compared to recent years. According to the CBRE report, the average rent for apartments is in the range of AED89,986, while for villas, it is about AED268, 758 per annum. Among all the apartment and villa communities in Dubai, Palm Jumeirah fared much better than other apartment communities during this period with average rents touching AED231,397, while Al Barari is clearly ahead of the rest of the villa communities with an average rent of AED946, 270.
It’s getting more and more interesting
These figures augur well for the future, with investors trying to cash in on the rising rental incomes and end users trying to lap up properties to live in before the rates go up further. All in all, this is one of the best times to be in the Dubai real estate market.
