Hedge & Sachs Real Estate Investment Outlook - Q4 2023

The UAE real estate market is witnessing a surge in investment thus far in 2023 with real estate transactions in the first half of 2023 trending upwards by 43.3% in Dubai and by 94.1% in Abu Dhabi. This trend is expected to continue in Q4 2023. This is due to a number of factors, including:

Here are some key trends to watch in the UAE real estate market in Q4 2023:

●??????? Strong Growth:?Real estate prices in the UAE are expected to continue to grow in Q4 2023, particularly in desirable areas. This is due to factors such as strong economic growth and limited supply. The UAE continues to offer investors a great return on investment for real estate investments which is what continues to fuel the growth and interest in the sector.

●??????? Foreign Investment:?The UAE is becoming increasingly popular with foreign investors, who are attracted by the country's strong economy, favorable government policies, and luxurious lifestyle. A recent report by the Department of Municipalities and Transport (DMT) has stated that in Abu Dhabi for example, Foreign direct investment (FDI) by individuals has reached AED 834.6 million during the first half of 2023, representing an increase of 363% compared to the same period in 2022. This is expected to boost demand for real estate in Q4 2023.

●??????? Growing popularity of off-plan properties:?Off-plan properties are becoming increasingly popular with investors, as they offer the potential to generate higher returns. Sales values for off-plan homes increased from Dh47 billion in 2009 to Dh83 billion in 2023, a 76% increase or an average yearly gain of 5.8%. The reason for this increasing popularity is due to off-plan properties being more affordable, with investors seeing them as a great return on investment.

●??????? Increasing demand for luxury properties:?According to Allsopp & Allsopp, the emirate’s ultra-luxury property segment recorded an impressive 176 deals with each exceeding $10 million, surpassing London, Paris and New York.

The demand for luxury properties in the UAE is expected to continue to grow in Q4 2023, to even become the fastest growing segment in the real estate sector, driven by the influx of high-net-worth individuals (HNWIs) to the country.

●??????? Growing popularity of sustainable properties:?Sustainable properties are becoming increasingly popular in the UAE, as people become more aware of the importance of environmental protection. Developers are responding to this demand by building more sustainable properties, such as those that use solar energy and recycled materials.

The UAE real estate market is expected to remain strong in Q4 2023, with continued price growth and increased demand from both residents and investors.

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