What's at Stake this week? | July 9, 2023

We thought we’d keep this introduction short and sweet, and dive right into what everybody wants to know - the numbers! They really do speak for themselves ??Have a look below at what Dubai’s real estate sector achieved last month, in the last quarter, and in the first half of this year…

?? Market Watch: Dubai Edition

An economic powerhouse with a booming property market

As the global economic landscape confronts increased pressures and the possibility of recessions looming over major markets like the U.S. and Europe, the United Arab Emirates has consistently displayed robust economic resilience. It is particularly noteworthy as banking heavyweight, HSBC Asset Management, has recently forecasted a potential economic downturn by Q4 2023, with warnings of a shrinking economy the following year and an imminent European recession.

Nonetheless, esteemed global institutions such as the International Monetary Fund (IMF) and the World Bank have lauded the UAE's strategic and forward-thinking economic approaches, both anticipating a flourishing economic outlook for the nation throughout the remainder of this year. The IMF estimates a growth of 3.6% in the UAE's GDP for 2023, an impressive progression from the notable 7.9% growth rate achieved in 2022. On the other hand, the World Bank projects a 2.8% growth in the UAE's real GDP, propelled by a burgeoning non-oil sector predicted to expand by 4.8%. Even though the overall growth rate has been revised downwards to 3.3% due to agreed oil production reductions, it is the non-oil sector, which includes the likes of tourism, real estate, construction, transportation, and manufacturing, that is expected to catalyze sustained economic growth this year.

Echoing this economic acceleration is the exceptional performance of Dubai's real estate market. A record-breaking AED 179.34Bn ($49Bn) in sales, achieved from 61K transactions, marked the first half of 2023. To put these figures into perspective, AED 114.5Bn was recorded last year in the same 6-month period across 42.9K transactions. This signifies a 57% surge in sales value YoY!

The month of June 2023 also set the tone for a new monthly record, with transaction values securing the fourth-highest monthly position despite the four-day Adha holiday. Read on below to learn more about last month's and Q2’s performance??

Momentum in Dubai real estate continues in Q2

According to the latest updates from the Dubai Land Department, the second quarter of 2023 continues to affirm what is looking to be a highly prosperous year in the real estate market. Let’s review!

• Last month saw more than 10.46K transactions worth AED 30.4Bn, marking increases of 18.5% YoY in terms of volume and 34.5% YoY in terms of value
• Of these transactions, 8.2K can be attributed to apartment sales and 800 to villas, with the rest related to commercial properties and plots. The total sales value accumulated on apartment transactions grew to 17.4Bn; a 40% YoY increase?
• Dubai Marina, Palm Jumeirah, Downtown Dubai, and Jumeirah Lakes Towers were among the top-performing areas of the month, raking in a major percentage of the total sales value

According to Property Finder, some of the key trends we saw back in April and May in the market remained somewhat similar whereby:

• 57.5% of prospective property owners express interest in purchasing an apartment and 78.5% of tenants in the rental market are searching for apartments?
• The most commonly searched apartment size for purchase was two-bedroom
• Among those searching for a home, 2-bed apartments remained a popular choice, comprising 34.1% of searches, followed closely by 1-bed apartments at 33.4%

We also got you covered with Q2 2023-specific numbers:

• Over 30.2K transactions worth AED 91.2Bn have been recorded, marking increases of 34.8% compared to Q2 2022 in terms of volume and 54.4% YoY in terms of value
• Around 23.2K apartments were sold while valued at AED 47.5Bn, a registered increase of over 50% compared to Q2 last year in terms of volume
• 4.1K villas were sold at AED 16.4Bn, which marked a decline of 31.7% QoQ, also in terms of volume

The bottom line? The real estate market in Dubai experienced a strong uplift in Q2 2023, with a significant increase in sales volume and value. Here’s looking at Q3 pushing the boundaries of what’s already been achieved so far this year! Keep an eye out for a similar report at the end of the upcoming period, and we’ll be sure to keep you posted with major updates along the way ??