Dubai Real Estate Market Analysis - Q3 2023

In the third quarter of 2023, the Dubai real estate market displayed remarkable resilience, defying the typical summer season slowdown. Let's delve into the key trends and data that offer a comprehensive understanding of the market dynamics.
Transaction Volume and Value: Q3 2023 recorded a total of 31,219 real estate transactions, amounting to a total value of 97.5 billion AED. Compared to the previous quarter, the market experienced a 4% increase in transaction volume and an 8% growth in total transaction value. 
What's more remarkable is the year-on-year performance, with a substantial 22% surge in transaction volume and a significant 40% increase in total transaction value.
Price Per Square Foot: One of the noteworthy trends in the Dubai real estate market during Q3 2023 was the remarkable increase in the average price per square foot. On a year-on-year basis, prices soared by an impressive 13%, bringing them to the peak levels witnessed back in 2014. This trend underscores Dubai's status as a highly attractive global investment destination.
Mortgage Transactions: Despite the presence of higher interest rates, mortgage transactions exhibited robust performance in Q3 2023. Compared to the previous quarter, there was a substantial 16% increase in mortgage transactions. On a year-on-year basis, mortgage activity grew by a commendable 13%. This data signals the resilience of buyers who are actively pursuing financing options to facilitate their property acquisitions.
Ready Property Market: The ready property market continued its upward trajectory during Q3, with a 7% increase in transaction activity compared to the previous quarter. On a year-on-year basis, the market witnessed an impressive 20% growth. Transactions within this segment constituted 53% of the overall transaction volume and a significant 63% of the total capital deployed within the real estate industry during the quarter, underlining the enduring demand for completed properties.
Off-Plan Sales: While off-plan sales remained relatively stable in Q3, with minor fluctuations, they remained a solid 25% higher than the figures recorded in the previous year, emphasizing the sustained confidence of investors in the market's long-term potential.
Off plan resales Activity: An intriguing development in the off-plan property segment was the increased activity of resale transactions, accounting for 15% of all off-plan sales during the quarter. This trend underscores the importance of vigilant monitoring to mitigate potential market volatility as it points to speculative activity.
Commercial Property Sector: The commercial property sector's performance in Q3 continued to validate our earlier assessments. It posted an impressive 37% increase in transaction volume compared to the previous quarter, and on a year-on-year basis, the sector exhibited an exceptional 82% growth. This remarkable performance can be attributed to the robust economic growth experienced in the country, making commercial properties an attractive avenue for investment.
Luxury Property Market Performance: The luxury property market in Dubai demonstrated stability compared to the previous quarter. However, what truly stood out was the substantial year-on-year growth, registering an extraordinary 52% increase. Notably, an impressive 75% of transactions for residential prime properties, exceeding the $10 million USD threshold, constituted ready property transactions, highlighting the robust demand for high-end properties in Dubai. This influx of high-net-worth individuals actively seeking premium, ready to move in properties underscores the market's appeal.
Supply and Demand: A balance between supply and demand is witnessed during 2023. While 18,837 units were delivered since the beginning of the year, marking the lowest figure since 2016, a robust pipeline of 37,279 units under construction indicates developers' commitment to meet the growing demand. This suggests the potential for market expansion beyond the annual norms.
In summary, the Dubai real estate market in Q3 2023 exhibited resilience, strong transaction activity, and notable price appreciation. Despite economic fluctuations and regulatory dynamics, the market demonstrated steadfast performance. Additionally, the luxury property segment remains an enticing proposition, solidifying Dubai's position as a premier global real estate hub.

Download the full Dubai Real Estate Market Report now - Q3 2023
Source : Research Team