Rising Demand for UAE Properties as Tenants Transition to Ownership
In Q1 2024, the United Arab Emirates witnessed a surge in demand for ready properties as more tenants opted for ownership over renting.
Contrary to Q1 2023’s surge in off-plan transactions, the first quarter of 2024 showed robust demand for existing projects in Dubai and Abu Dhabi, as per Property Finder data.
Since the onset of the pandemic, rents have steadily climbed over three years. With the population growth driving extraordinary demand, rental prices are expected to continue their upward trajectory in 2024. Faced with escalating rental costs, UAE residents are increasingly investing in real estate in Dubai and Abu Dhabi to lower monthly expenses and boost property value.
Cherif Sleiman, Property Finder’s Chief Revenue Officer, expressed optimism about the diversified demand, foreseeing promising growth ahead in 2024.
Dubai’s existing/ready market witnessed nearly 19,600 transactions in Q1 2024, claiming a 54% market share, a significant jump from Q1 2023’s approximately 15,000 transactions. This performance marked a notable 30% increase in volume compared to Q1 2023.
Transaction values in Q1 2024 constituted 68% of the total sales transaction value, reaching Dh78.2 billion, a substantial rise from Q1 2023’s 60%. Consequently, the current/ready transaction value surged from Dh53.6 billion in Q1 2023 to Dh46.6%.
According to Dubai Land Department (DLD) data, total sales transactions in Q1 2024 soared to over 36,000, a 17% increase from Q1 2023’s 31,000 transactions.
In Abu Dhabi, real estate transactions spiked to 814 in Q1 2024, up by 30% from Q1 2023’s 628 transactions, constituting about 38% of all transactions. The existing/ready transaction value in Q1 2024 contributed Dh1.74 billion, or 29%, to the total sales transaction value, compared to 27% in Q1 2023.
While residential sales transactions dipped slightly to around 2,145 compared to 2,286 in Q1 2023, both residential and commercial total sales transactions saw a decrease in Abu Dhabi, as reported by the Department of Municipalities and Transport (DMT).
The off-plan market in Abu Dhabi witnessed about 1,331 sales transactions in Q1 2023, declining to 1,658 transactions in Q1 2024, constituting 62% of total transactions compared to 73% in Q1 2023, indicating a 20% volume decrease year over year.