Dubai real estate market hits record transactions in 2023

Off-plan market and secondary deals drive sector's robust growth

 

The real estate market in Dubai recorded an all-time high in residential transactions in 2023, according to a report from CBRE. The report revealed that the total number of transactions reached 118,993 residential units, marking a remarkable 29.6 percent year-on-year increase in deal volumes. The off-plan market and secondary deals drove that robust growth, showcasing the resilience and attractiveness of Dubai’s real estate sector.

 

Rental trends and projections
 

Despite sustained high demand, CBRE noted a moderation in rental rates in Dubai in 2023. Average residential rents increased by 18.9 percent year-on-year, down slightly from the growth registered in the previous year.

In Abu Dhabi, average apartment rents saw a modest increase of 2 percent. Meanwhile, villa rents experienced a marginal rise of 0.8 percent in the fourth quarter of 2023. Looking ahead, CBRE projects continued rental growth in both Abu Dhabi and Dubai, particularly in prime areas in 2024.

 

Supply outlook
 

On the supply side, Dubai witnessed the delivery of 39,190 residential units in 2023. A significant portion of this was concentrated in key areas such as Meydan One, Downtown Dubai, and Business Bay. An additional 68,880 units are expected to be handed over in 2024, reflecting ongoing development activity in the emirate.

In Abu Dhabi, 2,961 units were delivered in 2023, with further deliveries anticipated in 2024, particularly in Yas Island and Al Maryah Island.

Read: Abu Dhabi property market continues strong growth

 

Industrial and logistics sector
 

In addition to residential real estate, Dubai’s industrial and logistics sector stood out as one of the most resilient asset classes in the city, according to a report from Savills. The expansion of the non-oil sector fueled demand for industrial and logistics space.

Particularly, built-to-suit warehousing facilities saw an increase in demand. Companies from various sectors were actively seeking warehouse space, driving transaction activity in the market.

As the UAE’s real estate sector continues to evolve, these trends underscore the dynamic nature of the property market and the diverse opportunities it presents for investors and occupiers alike.

 

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