Real Estate Prices In Dubai Continue Their Upward Trend During The Third Quarter Of 2023
Bayut, the real estate portal in the Emirates, issued the Dubai real estate market report for the third quarter of 2023, which unveils the most popular areas in the real estate sector in the emirate.
The release of the report follows the launch of BayutGPT, the world’s first virtual real estate search assistant based on artificial intelligence, which provides property seekers with an important repository of data, and is designed to facilitate better decision-making and deeper information about… market.
The report, which was based on search trends on the platform, showed that real estate prices in Dubai continued their upward trend, creating an ideal environment for sellers and property owners. The continued increase in prices is consistent with trends observed over the past eighteen months, where higher demand and a greater influx of new residents have led to unprecedented booms.
Real estate buying trends in Dubai
Bayut data shows that sales prices for apartments and villas in Dubai’s main neighborhoods rose by 2-12% in the third quarter of 2023.
For mid-priced apartments and villas, the most searched areas by property buyers and investors include Jumeirah Village Circle (JVC), Dubai Silicon Oasis, DAMAC Hills 2, and Al Furjan, while those searching for luxury properties preferred (Dubai Marina, Business Bay, Arabian Ranches, Dubai, Hills Estate) in the third quarter of 2023.
Sales prices in the areas most in demand for medium-priced apartments witnessed an increase of 9-15%, with the exception of Dubai Silicon Oasis, where the average sales transaction prices decreased by about 2%.
For mid-priced villas, the trend is similar with average selling prices rising by 10-17% in the most sought-after areas. Notable exceptions were recorded in The Springs and Dubailand, where sales transaction prices fell by 2% and 9%, respectively.
In terms of areas with luxury apartments, most have seen consistent price increases of less than 5%, with the exception of Palm Jumeirah, where average transaction prices have continued to rise by 14-15%.
Based on data from the Dubai Land Department, there were 30,981 residential real estate sales transactions (ready and under construction) worth AED 96.9 billion in the third quarter of 2023.
As for the return on investment, based on the expected rental returns for apartments, certain areas, including Dubai Investment Park, Al Liwan, and Remraam, have provided returns of up to 10%, and these percentages are considered convincing for investors. When it comes to luxury apartments, areas such as Al Barari and Jumeirah Golf Estates have offered impressive returns of up to 8%, which is much higher than most global markets.
ROI trends in villa communities
Bayut’s report monitored trends in return on investment in villa communities, which also reflected a positive picture. The villas purchased for investment and rented back in Jumeirah Village Circle offer an average return on investment of more than 9%, which is an excellent offer for potential investors. Areas such as International City and Town Square also offer an ROI of over 7% and when it comes to luxury villas, Al Barari is a good choice for investors with an ROI of over 8%. The uniqueness of these villas and the limited supply in the market have helped create demand in this area. Likewise, communities such as Damac Hills and The Sustainable City, which offer a range of facilities for families, offer a good return on investment of over 7%.
Real estate rental trends in Dubai
The Bayut report monitored an increase in advertised rental prices in the most sought-after areas as well, with rental prices for affordable apartments in the most sought-after areas increasing by up to 11%, while rental prices for luxury apartments witnessed an upward trend of up to 13%. Areas containing mid-priced villas saw prices rise by between 3% and 16%, while rents for luxury villas rose by up to 21%.
Mid-priced property seekers have focused on areas such as Jumeirah Village Circle (JVC) and Al Nahda Residential Apartments. For those looking for mid-priced villas, their search was mainly directed at Damac Hills 2 and Mirdif. In the luxury real estate sector, “Dubai Marina” and “Business Bay” remained the most popular options for renting apartments, while “Dubai Hills Estate” and “Arabian Ranches 3” are in demand for luxury villas.
