A Record-Breaking Begin for Dubai’s Real Estate Market

In January, Dubai’s real estate market experienced an unprecedented surge, recording the highest monthly transaction value in its history. This significant increase indicates robust buyer confidence, particularly in the primary market, which has emerged as a frontrunner in driving demand. As more individuals and families look for housing solutions in the emirate, the market showcases promising growth across various segments.

Surging Demand in the Primary Market

The latest reports highlight a remarkable 63% year-on-year increase in total transaction values, reaching AED 72.4 billion. A substantial part of this growth is attributed to an incredible 90% hike in primary market activities. Off-plan sales have emerged as a popular choice among buyers, with a staggering rise of 128% in related values. Meanwhile, the secondary market also showed resilience, reflecting a 38% increase in property values.

Factors driving the primary market’s success include a 23% surge in total transaction volumes, bolstered by a 42% rise in primary transactions. In contrast, the secondary market experienced a slight decline of 1% in transaction volumes but maintained its value stability, indicating an overall robust demand.

Stable Growth in the Secondary Market

Dubai’s secondary market has demonstrated noteworthy strength. The value increase of 38% was largely buoyed by the consistent performance of ready properties, which accounted for nearly 89% of total market value in this segment. Even as transaction volumes dipped slightly, ready units became a mainstay with values soaring by 48% year-on-year and with volumes increasing by 8%. While the off-plan segment of the secondary market saw a dip of 9% in both values and volumes, the overall interest remains high.

This trend shows a leaning towards immediate and quality housing, hinting that buyers prefer options that not only provide stable accommodation but also promise strong rental yields. As the demand for ready properties persists, the market’s dynamics continue to shift.

A Preference for Apartment Living

The popularity of apartment living remains strong as evidenced by buyer and renter preferences. In January, apartment searches constituted 78% of total inquiries, with buyers showing a marked preference for one- and two-bedroom units. This trend reflects the growing inclination towards compact and affordable living spaces, especially as rental prices have risen.

Demographics reveal that a significant portion of buyers, about 70%, are increasingly gravitating towards moderately sized units in well-connected locations, which provide both value and convenience. This trend facilitates accessibility in the competitive Dubai housing market, catering to singles, couples, and small families in search of affordable yet quality accommodation.

The Resilient Mortgage Landscape

The mortgage segment in Dubai has also shown remarkable resilience amid rising property values. Recent data indicates a 30% increase in mortgage volumes and values, primarily driven by decreasing interest rates, which have reduced from 4.0% to 3.5%. As more buyers leverage mortgages to elevate their purchasing capacity, the market remains buoyed by the prospect of upcoming property handovers expected this year.

The continued activity in mortgage utilization is a promising sign for both the property market and potential homebuyers. With the end-user market thriving and a favorable interest landscape, there lies a substantive opportunity for individuals eager to invest in higher-value properties.

In conclusion, the data supports that Dubai’s real estate market is not only resilient but also represents an attractive opportunity for investors and buyers alike. The diverse market segments indicate a healthy demand, making it an exciting period for both end-users and those looking for investment opportunities. As commented by Cherif Sleiman, Chief Revenue Officer of Property Finder, the year promises to uphold this momentum, showcasing sustained interest in high-quality offerings and essential rental demand.