Dubai real estate continues growth momentum with record transactions in 2022

Dubai’s real estate sector has been on an upward trajectory for quite some time, and the trend shows no signs of slowing down. In December 2022, the residential rents and transactions in the city reached record highs, with 8,662 transactions being recorded. This is a 63 percent increase compared to the previous year, and it was mainly due to the significant hike of 92.5 percent in off-plan sales and a 35.4 percent jump in secondary sales. This surge in demand has led to a 9.5 percent increase in property prices, with average apartment prices rising by nine percent and average villa prices by 12.8 percent over the same period. The increasing property prices have not deterred investors, and Dubai remains a hub for foreign investors and high-net-worth individuals (HNWIs). The city’s average apartment prices climbed to Dh1,168 per square foot, while average villa prices reached Dh1,385 per square foot in December 2022. These average rates have not yet surpassed the record highs of 2014, with the average apartment and villa prices being 21.5 percent and 4.2 percent below this peak. However, Jumeirah has registered the highest sales rate per square foot at Dh2,324 in the apartment segment while Palm Jumeirah registered the highest sales rate per square foot at Dh3,921 in the villa segment, according to the report. The rental market has also seen strong growth as average rents increased by 26.9 percent in the year to December 2022. Over this period, average apartment and villa rents increased by 27.1 percent and 24.9 percent, respectively. As at December 2022, average annual apartment rents stood at Dh95,168, and average villa rents stood at Dh282,150. Palm Jumeirah has recorded the highest average annual apartment and villa rents, with asking rents reaching an average of Dh248,452 and Dh1,016,956 per annum, respectively. The strong performance of the real estate market has been lauded by industry experts. Chantal Thomas, Sales Representative of Innovate Real Estate, said that 2022 proved to be a record-breaking year for Dubai real estate in many ways. "Not only was the market able to surpass the 2014 peak levels, but it also achieved new milestones as the years progressed. The same performance is expected from 2023 as well since foreign investors and HNWIs continue to get attracted by the Dubai property market and venture into it,” she said. The Dubai Land Department (DLD) also reported that 2022 was a record year for residential transactions, with 90,881 transactions being recorded, beating the previous record high of 81,182 in 2009. The CBRE report noted that villa rents are now 45.3 percent higher than in 2019, with average villa rents standing at Dh282,150, once again the highest level on record. Over the same period, average apartment rents are 17.2 percent higher and stand at Dh95,168. “The villa rents have recorded strong growth due to the lack of available villa stock for rent and growing demand levels for such stock,” the report said. This highlights the need for the development of new properties to meet the growing demand. Dubai's real estate market has been able to weather the impact of the COVID-19 pandemic, and the strong performance of the sector is a testament to the city's robust economic framework. The city has put in place a number of measures to attract foreign investors and HNWIs, such as the issuance of long-term visas and the implementation of favorable investment regulations. These measures have led to a surge in demand for Dubai's real estate