RIYADH: Dubai's real estate market continues to record growth in property deals, with the residential sector witnessing 8,269 transactions in October, registering a 72.5 percent increase from the prior year, global commercial real estate service provider CBRE said in its latest report.
The increase in property deals has been driven by a 133.5 percent growth in off-plan market sales while secondary market sales rose by 29.4 percent, it said.
Dubai’s property market has been showing signs of returning to the pre-COVID-19 levels as the emirate was among the first global cities to unshackle itself from the lockdowns after the government took a series of measures to contain the impact of the pandemic.
In the year to date to October 2022, CBRE noted that the total transaction volumes reached 71,412, which continues to be the highest total recorded since 2009.
This saw the average prices of residential units increasing by 9.2 percent in the year to October, with apartment and villa prices rising by 8.5 percent and 13 percent, respectively. The average apartment price in Dubai reached 1,149 dirhams ($313) per square foot, and the average villa price 1,359 dirhams per square foot, according to CBRE.
However, these average rates are still 22.8 percent and 6 percent below the peaks recorded in 2014 for apartments and villas.
“Residential rents in Dubai increased by 27.3 percent in October 2022 compared to a year earlier, extending on the record high annual growth we saw in the month prior,” said Taimur Khan, head of research – MENA at CBRE in Dubai.
He said data from Dubai’s Real Estate Regulatory Agency’s online registration system, Ejari, showed that the number of new contracts registered year-on-year in the year to date to October fell by 4.7 percent, whereas renewals have increased by 33.6 percent, indicating that “tenants are less willing to move given current market conditions.”
“We expect the rate of change in the rental market to start tapering off by the end of 2022. In the sales market, 8,269 transactions were recorded in October, a 72.5 percent increase from the year prior,” said Khan.
The CBRE expert pointed out that a total of 71,412 transactions were recorded in the year to date to October, to put this into context, in 2019 this figure totaled 29,394. “In terms of transaction volumes for the year, we expect 2022 total transactions to comfortably surpass the 2009 total,” he said.
In terms of residential areas, Jumeirah registered the highest average sales rate per square foot at 2,226 dirhams, said CBRE, adding that the villa segment of the market, Palm Jumeirah recorded the highest average sales rate per square foot at 3,704 dirhams.
The highest average annual apartment and villa rents were respectively seen in Palm Jumeirah, where average rents reached 242,250 dirhams on average, and Al Barari recorded average rents of 956,174 dirhams, according to CBRE.