Dubai's Priciest Locale and Top Property Investments: A $27 Billion Off-Plan Real Estate Surge

07 November 2023 / Dubai

In the past year, Dubai has witnessed an impressive 19% surge in average property prices. Our analysis unveils the most opulent apartments and the most lucrative investment opportunities. Notably, Dubai South has experienced a staggering 73% spike in property prices over the past year, while Palm Jumeirah reigns as the residence of the most extravagant apartments.

In the third quarter of the current year, the upward trajectory of residential property values in Dubai continued, marking the 11th consecutive quarter of price escalation.

Over the past year, the average residential property prices across Dubai have undergone a remarkable upswing of 19%. In the third quarter of 2023, the average residential property prices saw a 5% increase, contributing to a cumulative rise of 30% since the first quarter of 2020.

Despite these gains, prices still linger 7% below the 2014 peak.

The market for ready-to-move homes remains dominant, with a notable 51% of transactions occurring between the first and third quarters being secondary market sales, reflecting a high proportion of end-users and second-home buyers participating in the current market cycle.

With a surge in product launches in the last 12 to 18 months, and developers responding to the sustained and stable demand for homes, it's no surprise that the sales of off-plan homes have been steadily increasing. Off-plan sales for the first nine months of the year have amounted to AED 100 billion ($27.2 billion), while sales for ready-to-move homes reached AED 104.9 billion ($28.5 billion).

Dubai Property Investments

Examining the market by segment, apartment prices in Dubai saw a projected increase of 5.1% in the third quarter of 2023, reaching over AED 1,300 per square foot (psf). This marks a robust 26% surge since the first quarter of 2020, although it's worth noting that despite a significant 19% increase in the past year, apartment prices remain 10% below their 2014 peak.

In the villa segment, Dubai's prices experienced a 4.5% uptick between June and September, resulting in an average price of AED 1,580 psf. This reflects an 18% surge compared to the previous year and a remarkable 57% increase since the first quarter of 2020.

When we delve into the best-performing areas, apartments in Dubai South have shown one of the most robust growth rates, with prices soaring by an impressive 73% over the last 12 months. Not far behind are Jumeirah Lakes Towers (67%) and Umm Suqeim Third (Madinat Jumeirah Living) (37%), with approximate prices of AED 1,150, AED 1,780, and AED 2,860, respectively.

Furthermore, Palm Jumeirah continues to maintain its position as the most opulent apartment submarket, boasting prices of AED 3,390 per square foot.

Notably, both The Palm Jumeirah and Umm Suqeim Third submarkets have seen their prices surge past the levels of the first quarter of 2020 by 122% and 100%, respectively.

Jumeirah Islands witnessed a remarkable 65% increase in villa prices in just the past year, currently standing at AED 2,680 per square foot, making it the neighbourhood with the most rapid increase in villa values.

Additionally, Dubai South's villas have recorded the most substantial quarterly price change, skyrocketing by 33% during the third quarter.

These recent price escalations underscore the unwavering confidence in Dubai's luxury real estate market. The city's exceptional trajectory, world-class lifestyle, and strategic global position have firmly cemented Dubai's status as an attractive destination for the world's elite.

Currently, Dubai's real estate market remains notably affordable compared to other global cities, and it is anticipated that there will be substantial price growth at the upper end of the market over the next five years and beyond.

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