The maturity levels of Dubai’s booming real estate market become clearer as more data becomes available. Two of every five ready-to-move-in home sales in the third quarter had values under Dh1 million, per a recent study.
The ValuStrat Price Index, which gauges residential capital values, rose 28.9% annually and 6.7% quarterly to 190.1 points. This valuation-based index is benchmarked against the baseline of 100 points established in Q1 2021.
In Dubai’s freehold villa communities, the value of 98% of homes has doubled since the pandemic in 2020–2021, surpassing the price peaks of ten years prior. These milestones have not yet been reached by apartments, which comprise over 80% of Dubai’s housing stock, with the exception of those on Palm Jumeirah.
With capital values reaching 243.2 VPI points, the ready villa market continued to grow strongly, showing a slightly slower annual increase of 33.1 percent and quarterly growth of 7.4 percent. The top annual performers were Palm Jumeirah (42.8 percent), Jumeirah Islands (42.3 percent), and Emirates Hills (33.8 percent), while the lowest gains were recorded by Mudon (20.4 percent) and Jumeirah Village Triangle (20 percent).
Apartment values increased annually from 23.4% in the prior quarter to 24.8% in the third quarter. Discovery Gardens (33.5%), The Greens (33%), Palm Jumeirah (30.9%), Al Quoz Fourth (29.5%), and Town Square (28.6%) led the annual growth, while Jumeirah Beach Residence (17.6%), Dubai Sports City (17.8%), and International City (18.1%) showed the slowest gains.
The values of highly sought-after prime properties, which are renowned for their exceptional views, amenities, facilities, and layouts, increased by 30.7% annually and 7.3% quarterly, reaching a record high of 197.8 points. A 100-point baseline established in the first quarter of 2021 is used to compare this growth to.
The prime villa market reached 248.8 points with capital gains of 38.1 percent annually and 8.3 percent quarterly, surpassing the highs of all the villa communities under observation in 2014.
The capital values of luxury apartments in Dubai increased at a faster pace, reaching 166.6 points after increasing 24.7 percent year over year and 6.5 percent since the second quarter. Palm Jumeirah was the first neighborhood to see apartment prices rise above the 2014 highs.
This year, an estimated 35,524 new construction units are anticipated to be released onto the market. An estimated 13,217 apartments and 3,751 villas had been finished as of the first nine months of 2024, representing 48% of the original estimates.
Currently under construction are 30,272 villas and 98,253 apartments, with completion expected in 2028. Nine percent of these projects are located in Business Bay, five percent are located in Jumeirah Lake Towers, and eleven percent are located in Jumeirah Village Circle.
Off-plan (Oqood) registration volume reached an all-time high with 32,968 transactions during the quarter. This translates into investments of Dh83.2 billion, a 97% YoY and 32% QoQ increase. The average ticket size for off-plan homes dropped to Dh2.5 million annually, according to data from ValuStrat. The average price of off-plan real estate in the city was Dh19,537 per square meter, or Dh1,815 per square foot.
Data shows that 12,883 ready secondary home transactions, totaling Dh29.8 billion in investments, took place in the third quarter. This represents an increase of 19.4% from the previous year and 11.9% from the previous quarter.
On a quarterly basis, the average ticket size for ready properties dropped 9.2% to Dh2.3 million, but remained unchanged on an annual basis. The prices of 41% of all ready-to-move-in home sales were less than Dh1 million.
53 luxury homes worth over Dh30 million were sold, compared to 62 at the same time last year. The average transacted price for ready units in the city during the quarter was Dh15,414 per square meter (Dh1,432 per square foot), according to ValuStrat data. This was a 5.5% quarterly decrease but a 7.1% year-over-year increase.
The average number of apartments sold in the third quarter was 95.4 square meters (1,027 square feet). The average villa size was 294.9 square meters (3,174 square feet).
For available properties, Dubai Marina (5.6%), Business Bay (5.6%), and Jumeirah Village Circle (9.1%) had the highest transaction rates.
The third quarter of 2024 saw 14,977 cash transactions of ready-to-move-in properties and 10,118 mortgage transactions across all asset classes; the cash transactions totaled Dh28 billion, while the mortgage transactions accounted for Dh19 billion of the total sales value.
“The market continued to shift towards mid-market and affordable apartments. The average size of sold homes shrunk to its lowest level and average sales prices per square foot softened for the first time this year. Dubai’s property market experienced extraordinary progress in Q3 2024, with record population growth and falling interest rates driving the upswing. Overall, Dubai’s property market set new records in Q3 2024, with villas outperforming apartments and significant growth across the office, hospitality and warehouse sectors,” said Haider Tuaima, director and head of real estate research, ValuStrat.
Whatsapp