In the first quarter of 2024, demand for ready properties increased in the United Arab Emirates as more tenants chose ownership over increasing rentals.
In contrast to the first quarter of 2023, when off-plan transactions skyrocketed, the first quarter of 2024 saw strong demand for existing projects in both Dubai and Abu Dhabi, according to data released by Property Finder.
Following the pandemic, rents have steadily increased over the last three years. Due to the extraordinary demand from the growing population, it is anticipated that this upward rental trend will continue in 2024 as well. Due to rising rental costs, UAE citizens are turning to purchasing real estate in Dubai and Abu Dhabi, which will lower their monthly payments and increase the value of their properties.
“2024 has opened up to an interesting and promising phase of growth. We can see a more diversified demand and we are positive of the impact this will have in the months to come,” said Cherif Sleiman, chief revenue officer, of Property Finder.
Based on available data, the Dubai existing/ready market recorded nearly 19,600 transactions in the first quarter of 2024, upping its market share to 54% of all transactions from roughly 15,000 transactions in the same period the previous year, which accounted for 48% of all transactions. Comparing this performance to Q1 2023, there was a noticeable 30% increase in volume.
Transaction values in Q1 2024 accounted for 68% of the total sales transaction value, reaching Dh78.2 billion, as opposed to 60% in Q1 2023. As a result, the current/ready transaction value increased significantly from Dh53.6 billion in Q1 2023 to Dh46.6%.
The number of total sales transactions in Q1 2024 increased significantly, according to data from the Dubai Land Department (DLD). With over 36,000 transactions compared to 31,000 transactions in Q1 2023, the number of transactions recorded was the second-highest for the quarter ever, indicating a significant increase of 17%.
Comparing Q1 2023 to Q1 2023, there were approximately 16,600 off-plan sales transactions, or 46% of the total transaction volume, as opposed to 52% of the total transactions in Q1 2023.
814 transactions in Abu Dhabi
Compared to 628 transactions that accounted for 27% of all transactions in Q1 2023, Abu Dhabi real estate recorded 814 residential transactions in Q1 2024, or roughly 38% of all transactions. This represented a noteworthy 30% increase from Q1 2023. Compared to 27% in Q1 2023, the existing/ready transaction value in Q1 2024 contributed Dh1.74 billion, or 29%, to the total sales transaction value.
The number of residential sales transactions reached a quarter of around 2,145 transactions compared to 2,286 transactions in Q1 2023, which represents a slight decrease in total sales transactions (both residential and commercial) for the Department of Municipalities and Transport (DMT), Abu Dhabi.
The off-plan market in the capital of the United Arab Emirates recorded about 1,331 sales transactions in Q1 2023 as opposed to 1,658 transactions in Q1 2023. This represents 62% of the total transactions as opposed to 73% in Q1 2023, indicating a notable 20% decline in volume year over year.