ValuStrat report identifies trends in Dubai real estate sector with most villa prices doubling since 2020 and mid-market properties becoming popular
Dubai real estate sector is shifting towards mid-market and affordable apartments with two out of five ready home sales worth less than AED 1m ($272,000), according to a report from ValuStrat.
The report from Haider Tuaima, Director and Head of Real Estate Research at ValuStrat comprehensively analyses the residential, commercial, and hospitality sectors and underscores a market showing robust growth and market activity.
Tuaima said Dubai’s property market experienced extraordinary progress in Q3 2024, with record population growth and falling interest rates driving the upswing.
Dubai real estate affordable property
Home sales and mortgage applications reached all-time highs, while office and warehouse prices also hit record levels.
At the same time, the average size of sold homes shrunk to its lowest level, and average sales prices per square foot softened for the first time this year.
The ValuStrat Price Index (VPI) showed a 28.9 per cent annual increase in residential values. Freehold villa communities surpassed ten-year price peaks, with 98 per cent of villas doubling in value since 2020.
Ready villa and townhouse prices saw a 33.1 per cent annual rise, while apartment values grew by 24.8 per cent this quarter, up from 23.4 per cent in the previous quarter.
Apartment rentals increased by 15.4 per cent over the past year, significantly outpacing the 4.9 per cent rise in villa rents.
Demand for office space in Dubai remains robust, though capital values experienced a more moderate quarterly growth of 2.6 per cent, resulting in a 25.8 per cent annual increase, sales up 3.8 per cent, and rents increasing by 20.8 per cent on average.
Logistical warehouses experienced a 14.6 per cent annual increase and a 5.2 per cent rise quarterly.
Demand has strengthened and is fuelled by favourable market conditions, business expansions, and new companies entering the region. The total number of hotel keys in Dubai has surpassed that of major cities like London, Paris, and New York, and it is on track to surpass Tokyo and Las Vegas.
The rapid growth in tourist numbers has maintained high occupancy levels year-round.
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