Dubai's Real Estate Market Braces for Massive Expansion

Almost 40,000 new properties in the planning phase will hit the market in the last quarter of 2024. This could raise the total number of new homes on the real estate market to nearly 126,000 this year. The Dubai real estate market is facing a strong supply wave in terms of new projects, as various developers plan to launch nearly 200 additional projects. In the first 8 months of the year, announcements for new projects reached nearly 86,000 homes, with a total sales value of 213.7 billion dirhams. According to the latest report by Cavendish Maxwell's Property Monitor, these figures are expected to exceed last year's 272 billion dirhams.

With nearly 200 additional projects tracked by the Property Monitor team in the planning phase, we expect new project announcements to remain at historical levels for the remainder of 2024, adding a further 35,000 to 40,000 homes to the planning phase market.

Significant growth in new development activities is anticipated across various price categories and communities, especially for homes in Dubai Islands, Jumeirah Garden City, Dubai Maritime City, Motor City, and Dubai Land Residence Complex, as well as single-family properties such as townhouses and villas in The Valley, The Acres, The Oasis, and The Height Country Club.

In the past two years, numerous foreign developers have entered the Dubai market to capitalize on the unprecedented demand for properties in the planning phase from residents and investors. Prices and rents have also risen as the emirate's population has significantly increased, reaching 3.781 million people.

In August, the total volume of sales transactions increased by 0.28 percent, reaching 16,145 transactions, representing not only the highest August volume but also the second-highest monthly figure overall.

This continues a string of record-breaking months. In fact, every month in 2024, except April, has reached the highest transaction volume for the respective month, according to the Property Monitor report.

Similarly, real estate prices also reached historical peaks, reaching 1,431 dirhams per square foot. Prices are now 82.4 percent higher than the April 2009 low and 16.03 percent above the September 2014 peak.

In the absence of significant economic, geopolitical or unforeseen global events, the current market conditions are likely to provide the opportunity for continuous growth throughout 2024. On an annual comparison, prices increased by 17.7 percent in August, and year-on-year growth has been observed for 42 consecutive months, while prices rose by 11.5 percent annually in August 2024, compared to 10.9 percent in August 2023.

The Dubai real estate market continues to show strong momentum with significant price increases. The surge in sales of planning-phase projects is a major driving force, while high transaction volumes reflect continued buyer confidence, despite a temporary decline in mortgage activity.

The volume of sales transactions grew to 16,145 in August, marking a 0.2 percent increase compared to July 2024. During the month, the distribution of real estate transactions based on Oqood and Title Deeds tilted in favor of the former, with Oqood registrations accounting for 64.8 percent of all transactions, marking a 6.5 percent monthly increase.