Dubai Real Estate: Rents Jump Over 20% In 2023
Rent prices for residential units in Dubai grew by 22 percent during the first half of the year, a new report finds.
During this period, average apartment rents grew by 21.9 percent and villas by 22.6 percent, according to real estate firm.
The rental price growth was slightly down from the 22.8 percent recorded in June 2023. However, demand in the rental market increased further, said Taimur Khan, the firm’s Head of Research for the MENA region in Dubai.
“Demand in the rental market has also increased further, where year-on-year in the year to date to July 2023, the total number of rental registrations has grown by 8.8 percent,” said Khan.
Though the total number of new rental contracts registered substantially dropped by 12.6 percent, renewed rental registrations rose by 29 percent.
“Given the current market backdrop, vis-à-vis the lack of supply and exacerbated demand levels, we expect that rents in Dubai will continue to increase moving forward, albeit at a slower pace,” he added.
Dubai’s property sector is experiencing remarkable growth, with the total volume of residential transactions reaching an impressive 10,080 in July 2023. This marks a substantial year-on-year increase of 53.4 percent, fueled by a surge in both off-plan market sales, which soared by 78.4 percent, and secondary market sales, which saw a 33.8 percent rise.
This surge in transaction volumes continues to shape the real estate landscape, as the year-to-date total transactions for 2023 up to July have reached an unprecedented 67,818, setting a new record for this period.
Average prices surged by 18.1 percent in the year leading up to July 2023, reflecting an uptick from the 16.9 percent growth rate observed in June.
During this period, the average prices of apartments soared by 18.5 percent, reaching AED1,320 per square foot, while average villa prices also climbed by 16.2 percent, reaching AED1,552 per square foot.
Despite the surge, average apartment sales rates are still 11.3 percent below the historic levels seen in late 2014, yet many core and prime submarkets have consistently outperformed their 2014 benchmarks. Average villa prices, on the other hand, have exceeded their 2014 peak by 7.4 percent.
