Real Estate Market Performance in the UAE: A Look at 2023

The real estate market in Dubai is experiencing a significant surge, with average residential prices increasing by 20.1 per cent in the year to December 2023. According to analysts at leading real estate services and investment firms, the UAE’s real estate market is on track to record another stellar year, with activity levels reaching multi-year record highs in many sectors.

In Dubai, both apartment and villa prices saw substantial increases, rising by 19.8 per cent and 21.8 per cent, respectively. This growth is attributed to solid activity levels within the real estate market, as noted in CBRE’s UAE Real Estate Market Review Q4 2023.

Experts predict that despite potential global economic headwinds, the performance and activity levels in the UAE’s real estate market will remain resilient in 2024. While there may be risks of oversupply in select assets, the macroeconomic sentiments for the UAE remain favorable, with non-oil sectors seeing significant expansion and poised for further growth.

Residential transaction activity in Dubai saw a 29 per cent year-on-year growth to an all-time high of 118,200 units, while the office real estate market witnessed a surge in demand, with some developments experiencing yearly rental increases of more than 40 per cent. In Abu Dhabi, however, the rental activity experienced a slowdown, with a decrease in registrations in the last quarter of 2023.

Looking ahead, new residential units are expected to be completed in both Dubai and Abu Dhabi, with the hospitality sector also seeing growth. Abu Dhabi saw a 29.0 per cent year-on-year increase in hotel visitors in 2023, while Dubai experienced a 19.4 per cent rise in international visitors.

Overall, the real estate market in the UAE is poised for continued growth and activity, with experts anticipating resilience in performance and activity levels throughout 2024.