According to data released on Tuesday, the first half of 2023 saw a continuous increase in off-plan transactions in Dubai and Abu Dhabi, signaling rising investor confidence and solid take-up of recently announced projects.
According to JLL’s Q2 Market overview report, the value of off-plan residential sales climbed by 38% year over year in Dubai and by 30% in volume in the second quarter of 2023, while it more than quadrupled in Abu Dhabi from Dh1.8 billion to Dh3.8 billion.
Investors notably targeted studios and one-bedroom apartments in neighborhoods like JVC, Dubailand, and MBR City, accounting for the majority (57%) of sales in this category in Dubai that were registered between Dh500,000 and Dh2.0 million. According to the research, villa transactions on Al Reem Island and Yas Island are what account for the majority of the activity in Abu Dhabi, which is centered between Dh2.0 and Dh3.0 million.
In the residential sector, 7,300 units were delivered in Dubai during the third quarter, bringing the total number of residential units on the market to 700,000. Another 21,000 units are expected to be delivered in the second half of this year. The residential stock in Abu Dhabi reached 283,000 units after the installation of 1,000 apartments. According to the JLL reports that there will be close to 3,000 units available by 2023, most of which will be apartments in master-planned communities including Al Raha Beach, Al Maryah Island, and Al Reem Island.
According to the Dubai Land Department, the real estate market in Dubai experienced its greatest semi-annual sales ever in the first half of 2023, with a total of 60,440 sales transactions valued at Dh177.3 billion. The entire value of real estate transactions in Dubai during the first half of this year totaled Dh 252.7 billion, with the recorded value of registered real estate mortgages reaching Dh61.7 billion in the first half of 2023, including grants totaling Dh13.6 billion.
In the first half of this year, ready properties accounted for the majority of real estate sales in Dubai, recording 30,116 sales transactions with a value of Dh107.5 billion, up from 25,371 sales transactions with a value of Dh79.6 billion in the same period last year. This represents a 35% increase in sales value.
According to a new analysis from Unique Properties, Dubai’s real estate market is on track to generate roughly Dh300 billion in sales this year as a result of a boom in property investment by high-net-worth people between 2012 and 2022.
All industries showed strength and adaptability in the second quarter, Faraz Ahmed, associate, of research at JLL Mena, said. This was fueled by new and developing trends. The steady rise in off-plan purchases, increasing demand for high-quality office space, changing retail offers, and revolutionary hotel makeovers all point to Dubai and Abu Dhabi as dynamic investment locations, he said.
“With strong investor confidence, robust absorption of new projects, and innovative developments, there is no doubt that these cities are paving the way for sustained growth and transformation across the entire real estate landscape in the UAE,” said Ahmed.
While the performance of the residential market in Dubai continued to improve, as evidenced by a 16% increase in sale prices and a 24% increase in rentals in May 2023 compared to the same period the previous year, in Abu Dhabi, outdated stock on the main island continued to be under pressure from newer high-end communities. This pattern is probably going to persist as Abu Dhabi drives interest in prospective new islands. mixed-use neighborhoods.
The Plaza by Reportage in Masdar City has been the go-to option for affordable off-plan apartments in Abu Dhabi, according to Bayut’s real estate market report for H1 2023, while Yas Bay in Yas Island has continued to draw High-Net-Worth investors. Affordable apartment sales prices have often dropped by up to 5%, whereas villa prices have increased by up to 3.42 %.