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According to the latest report from the CBRE consultancy, the average apartment prices in Dubai rose 14.5% to AED 1,256 (342%) per square foot, while average villa prices rose 14.9% to AED 1,484 ($404) per square foot per annum.
The pace of sales on a monthly basis also accelerated, with apartment prices up 1.8% and villas up 2%.
Although the average apartment sales across the emirate are still 15.6% below the record levels registered at the end of 2014, they have already exceeded these values in several areas. Meanwhile, average villa sales are now 2.7% above their peak in 2014.
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Areas with the highest price increases
Jumeirah remains the most expensive area to buy in the apartment segment. Here the price per square foot is AED 2367 ($645). However, this is 3.1% less than in March.
The highest price tag per square foot was recorded on Palm Jumeirah - AED 4635 (1262 $), which corresponds to a 4% increase on a monthly basis.
The four most expensive areas for buying apartments are:
- Downtown Dubai
- Palm Jumeirah
- Dubai Hills Estate
- Bur Dubai
The most expensive areas to buy villas are:
- Jumeirah
- Emirates Hills
- District One
- Jumeirah Islands
Sales growth and its causes
The total number of real estate transactions in April amounted to 7,615, up 16.2% compared to the same period last year. This brings the total number of transactions to 36,946 in 2023, up 43.2% from the same month in 2022, a record for the first four months of any year to date.
This growth was driven by activity in the new housing market, where sales rose by 42.5%, which in turn offset the weakness in the second-hand property market, where sales fell by 2.4%.
Taimoor Khan, Head of Mena Research at CBRE explained: “On a monthly basis, there has been a decline in activity levels since the record high recorded in March 2023. Despite this - and against the background of increased demand - average housing prices in Dubai continue to show significant growth. To date, the level of activity in the emirate's residential real estate market remains stable.”
Dubai's property market has recovered significantly from the coronavirus pandemic last year, helped by rising oil prices and government policies, including changes to visa rules to attract more investment.
Last year, the value of real estate transactions in the market reached a new high of AED 528,000,000,000, up 76.5% year on year, while the number of transactions rose 44.7% to 122,658 year on year.
Changes in the rental market
The average rent in 2023 jumped by more than a quarter compared to April due to an increase in the rental of apartments and villas by 25.7% and 26.1%, respectively.
The average annual rent for apartments and villas in April was AED 102,675 ($27,961) and AED 308,616 ($84,044), respectively.
The highest average annual rent for an apartment was recorded on the Palm Jumeirah island – AED 263,762 ($71,829).
In the villa segment, average rentals peaked in Al Barari at almost AED 1,008,000 ($274,506) per year, according to CBRE.
Rents are rising due to the influx of wealthy people into the city, as well as the introduction of new visa programs that encourage residents to stay longer or move from abroad.
