Dubai real estate strong in Q3 2022

Dubai real estate strong in Q3 2022

The volume of real estate transactions in Dubai in Q3 amounted to AED 70B (USD 19B). As a result, the total of 25,496 deals was an increase on the AED 59B (USD 16B) during the previous quarter of 2022 (22,31 transactions).
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Published November 08, 2022
Despite inflation concerns and strains on the global economy, the third quarter of 2022 ended on a strong note, extending the period of growth and recovery to 23 months since bottoming out.

Since the beginning of the year, 31,000 units have been added to the market’s inventory, which is the highest figure since 2018. According to experts, the number of real estate releases will increase in the upcoming quarters, as developers prepare to announce the launch of new residential communities or restart the development on some of the major projects that were previously on-hold, such as Nakheel’s Palm Jebel Ali.
The average cost per square foot of real estate in the emirate of Dubai is 16% higher than this time last year. Villas and townhouses have seen the greatest price increases, as the average price per square foot rose by 30% in the last year to AED 1,282 (USD 349) per sq. ft. Apartments had a comparable rise of 29% year on year to AED 1,512 (USD 412) per sq. ft. Hotel apartments that are currently AED 2,404 (USD 655) per sq. ft and commercial property of AED 1,381 (USD 376) per sq. ft had more modest gains of 10% and 8% respectively.

Boosted by bulk mortgage transactions and refinancing, mortgage activity also increased during the quarter, despite several interest rate increases by the UAE’s central bank. Mortgage volumes rose by 9% from the previous quarter and by 185% year on year. Cash deals decreased by 2% from the previous quarter but remained 86% higher than the previous year.
Secondary market deals (ready property) were steady in comparison with the previous quarter, but 52% higher than the previous year.

Primary market transactions (off-plan) increased by 31% quarter-on-quarter and 74% year-on-year as a result of a surge in launches of new developments by developers catering to the recent increase in demand from high-end luxurious real estate buyers.

The strong performance of the Dubai real estate market in Q3 continued this month. As stated by the Dubai Land Department (DLD), a total of 2,703 real estate deals worth AED 8B (USD 2B) were conducted during the week ending October 21, 2022.

147 real estate plots were purchased for AED 1.12B (USD 304.9M) in Dubai, while 2,023 apartments and villas were sold for AED 4.79B (USD 1.3B), according to the WAM.

The top transactions were an Al Thanayah Fourth land plot that sold for AED 85M (USD 23M) in Al Thanayah and another plot sold for AED 63M (USD 17M) in Island 2.