Q1 2024: UAE real estate up 20%
Photo source: meydan.ae
The UAE real estate market was up 20% in Q1 2024, with both Dubai and Abu Dhabi reporting growth in sales prices and rental rates. This positive trend reflects an ongoing demand for residential spaces, propelled by economic growth and strategic developments within the region.
Remarkable Growth in Dubai’s Property Sector
Dubai’s property market has shown remarkable strength in the first quarter of 2024, particularly in the villa sector, where sales prices have surged by over 22% year-on-year. This uptick in property values encompasses both apartments and villas, highlighting widespread consumer confidence and investment interest.
The first quarter saw a continuation of the price increase trend in Dubai, with an overall annual rise of 20.7%. Breaking down the figures, apartments have seen a price increase of 20.4%, while villas experienced a growth rate of 22.1%. Notably, these figures are just marginally below the peak prices of 2014, with several districts already exceeding those historical highs. As of March 2024, average apartment prices were at AED 1,486 per square foot, and villas at AED 1,776 per square foot.
The rental market in Dubai is also experiencing a surge, with a significant 21.2% year-on-year increase as of March 2024. This growth was slightly higher than the previous month, indicating a strengthening in the rental sector. Detailed data show a 22.1% rise in apartment rents and a 14.5% increase in villa rents, underpinning the overall health of Dubai’s residential rental market.
Dubai’s residential market achieved a new milestone in March 2024 with the highest ever recorded transaction volumes for a single month, showing a 13.2% increase year-on-year. This period saw a 20.2% rise in off-plan sales and a 2.2% increase in secondary market sales. This vigorous activity signifies a strong market with a sustained interest in both new developments and existing properties.
A total of 6,526 units were delivered in Q1 2024, with the majority of this supply being in Meydan One, Jumeirah Village Circle, and Al Furjan.  Dubai’s total transaction volumes reached 35,310, up 20% year-on-year.
A further 46,086 are expected to be handed over the remainder of the year. However, given historic materialization rates, CBRE expects that a limited portion of this upcoming stock will come online as planned.
Abu Dhabi’s Consistent Market Growth
Meanwhile, Abu Dhabi’s real estate sector isn’t far behind, with its significant achievements in the first quarter of 2024. The total volume of transactions increased by 22.6% compared to the same period last year, driven by robust sales in both the off-plan and secondary markets,  with a total volume of transactions of 2,795 units.
The capital city saw its average apartment and villa prices rise by 4.3% and 2.3%, respectively. However, the rental market has faced some challenges, with a 10.9% decline in total residential rental contracts. Despite this, the prices for apartment and villa rents have increased by 4.5% and 1.1%, indicating a potential stabilization in the upcoming months.
Industry Insights from Experts
Taimur Khan, Head of Research – MENA at CBRE, commented on the robust start to the year, noting that “the elevated demand levels continue to drive performance.” He anticipates that the high activity and strong absorption rates, which have been reducing available supply, will support price growth in both cities through the year. Khan expects a continued rise in rental rates, particularly in prime areas, although the pace may moderate in the second half of the year.