According to a ValuStrat Price Index (VPI) review of Dubai home valuations in May, robust demand mitigated the impact of flooding caused by April’s record rainfall.
Villa capital values grew at similar monthly rates, while apartment valuations increased faster than in April, according to ValuStrat analysts.
In May, the VPI reached 174.4 points, representing a 27.2% annual increase and a 2.1% monthly rise. Villas scored 221.2 points, while apartments received 144 points, compared to the January 2021 baseline of 100 points.
According to JLL Mena, the UAE residential sector experienced strong growth in Q1 2024. In Dubai, annual increases in sale prices and rentals averaged around 21%. Sales prices in Abu Dhabi increased by an average of 7.0 percent, while rental rates rose by an average of 4.0 percent during the same period, according to JLL’s Q1 review.
According to Knight Frank data, the average house price in Dubai was Dh3.3 million in 2024. The cost of real estate in Dubai varies greatly depending on the property type, size, location, and amenities. Older apartments in outlying areas start at Dh400,000, mid-range villas in suburban communities average Dh2-3 million, and luxury penthouses or beachfront mansions can easily cost more than Dh50 million.
According to the ValuStrat Price Index report, most established villa communities in Dubai have exceeded their previous capital value peaks beginning in 2024, with Palm Jumeirah becoming the first apartment area to do so this month. Monthly apartment prices rose by 1.8%, 0.2% higher than in April, for a record annual growth of 22.4%.
The areas with the highest apartment capital gains compared to the previous year are Discovery Gardens (34%), The Greens (32.6%), Palm Jumeirah (30.9%), Al Quoz Fourth (29.1%), and The Views (28.1%).
Villa capital gains were 2.4% in April and 32.5% over the previous year. Notably, top annual performers include villas in highly desirable areas such as Palm Jumeirah (41.7%) and Jumeirah Islands (41.1%), Dubai Hills Estate (37.5%), Emirates Hills (32.5%), and The Lakes (32.1%).
Contract registrations for off-plan homes increased by 76.3 percent year on year and 41.6 percent monthly, reaching a monthly high of over 10,000 transactions, accounting for 69.4 percent of all residential sales. Meanwhile, the number of ready-to-move-in transactions increased by 8.1% over the previous year and 45.9% since April.
In the prime home sector, there were 16 transactions for ready properties worth more than Dh30 million in Palm Jumeirah, Dubai Marina, Jumeirah Bay Island, Emirates Hills, and District One.
In May, Emaar (16.6%), Azizi (8.5%), Sobha (8.2%), Damac (7.9%), and Nakheel (3.6%) led the developer sales charts.
The top off-plan locations transacted included projects in Jumeirah Village Circle (10%), Ras Al Khor (9.5%), Meydan One (9.4%), and Dubai Hills Estate (7.7%). Meanwhile, the majority of ready homes were sold in Jumeirah Village Circle (8.3%), Business Bay (6.6%), Dubai Marina (5.9%), Downtown Dubai (5.3%), and Jumeirah Lake Towers (3.9%). Discovery Gardens and Dubai Hills Estate broke their individual records for the most off-plan homes traded in one month.