As Dubai’s population experiences rapid growth, the demand consistently surpasses the available supply.
Dubai’s robust off-plan real estate sector, exhibiting impressive growth over the past four consecutive years, has propelled the overall UAE market to achieve Dh455.7 billion in sales in 2023.
As the off-plan sector is expected to continue supporting the market’s growth in 2024 and beyond, realty experts emphasize the imbalance between demand and supply.
Despite the completion of over 60,000 units, demand continues to surpass supply, fueled by Dubai’s rapidly growing population, making it among the fastest globally, according to Madhav Dhar, COO and founding member of Zazen Properties.
In 2023, Dubai experienced notable growth, with a sales value of Dh160.46 billion, a 72.3% increase from 2022. Additionally, 68,783 off-plan sales transactions were recorded in 2023, marking a 59.4% rise from 2022.
Dhar commended the UAE’s visionary decision to eliminate the Dh1 million down payment requirement for the golden visa program, anticipating a positive impact on Dubai’s real estate landscape. This move not only enhances accessibility for investors but also injects fresh vitality into the market.
The UAE’s strategic approach to fostering a resilient and competitive real estate sector by easing entry for investors and stimulating demand demonstrates its commitment to innovation and growth, according to Dhar.
Experts believe that the recent elimination of the Dh1 million down payment requirement for the golden visa will attract thousands of investors and contribute to boosting the UAE’s real estate sector value. This move is expected to prompt developers to accelerate their construction pace.
In the third quarter of 2023, off-plan transactions dominated Dubai’s property sales, constituting 65% of the total sales value at Dh13.62 billion. Off-plan transactions also accounted for 61% of the total property sales volume.
Analysts attribute the rebound of Dubai’s off-plan market to robust governmental initiatives and increased investor interest. The integration of new technologies, such as virtual reality property tours and blockchain, is reshaping the off-plan market, enhancing transparency and efficiency.
The current trend of rising mortgage rates has shifted the viability of investing in ready properties for returns. Despite increased rental yields, servicing a mortgage has become costlier, resulting in diminished net yields after factoring in all expenses. This makes it an opportune time to invest in off-plan properties, offering investors flexibility in managing finances, especially considering Dubai’s population growth driving demand.
