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Apartments big hit among Dubai buyers, Abu Dhabi realty sees gains too

Dubai Marina, Downtown, Jumeirah Village Circle, Business Bay and Palm Jumeirah emerged as the preferred spots for apartment buyers

Property transactions in Dubai have surged close to AED30 billion (USD 8.16 billion) in value, with demand for residential units, especially flats, remaining strong, stated real estate company Property Finder.

“Around 60% of property buyers last month were looking to own an apartment, while around 40% were interested in acquiring villas or townhouses,” the venture stated.

Property Finder, in its market survey, found out that within the rental market, around 82% of tenants were looking for apartments, while 18% preferred villas/townhouses. Among the tenants wanting to find an apartment, 67.5% preferred furnished properties, while 30.9% opted for unfurnished options, noted the study.

The report further saw Dubai recording 7,128 real estate transactions worth AED29.7 billion in October 2023, up by 17.46% in value compared to the same month in 2022. Dubai Marina, Downtown, Jumeirah Village Circle, Business Bay and Palm Jumeirah emerged as the preferred spots for apartment buyers.

For those looking to own high-end properties like villas/townhouses, the most popular locations were Dubai Hills Estate, Arabian Ranches, Palm Jumeirah, Al Furjan and Mohammed Bin Rashid City.

Also, the volume of existing property sales reached 5,602, up by 36.8% compared to the 2022 tally. Property Finder also discovered that the existing properties’ value surged by 81% to around AED25.7 billion, the reportedly highest transaction value recorded in the segment for the month of October since 2013.

Meanwhile, commercial real estate services provider CBRE said that as of September 2023, activity levels softened in Dubai’s residential market due to a “contraction in the off-plan segment”.

Dubai saw a 41.5% fall in off-plan sales during the month, while secondary market sales went up by about a third, CBRE discovered.

“In Q3 2023, Abu Dhabi’s residential market exhibited moderated capital gains, with the ValuStrat Price Index (VPI) growing by 4.3% annually and 0.8% quarterly, reaching 75.5 points. The apartment sector remained stable compared with the previous quarter, registering a 3.3% annual increase to 72 points. Meanwhile, the villa market outperformed with a 1.3% quarterly and 5.3% yearly increase, achieving 79.2 points,” stated CBRE.

“The VPI for annual rental values in Abu Dhabi expanded 7% annually and 1.2% quarterly to reach 80.6 points. Villa rental values stood at 92 points, with a notable 9.6% annual and 2.8% quarterly increase. Apartments saw a 4.7% annual rise, registering 71.9 points,” it added further.

However, Abu Dhabi’s office asking rents in primary commercial districts declined 5.1% quarterly and 4.2% annually.

In the Emirati city’s hospitality sector, with the current 34,000 hotel keys, the occupancy rate for the period of January to August 2023 was 73%, up by 2% from 2023, while the Average Room Rate (ARR) and the Revenue Per Available Room (RevPAR) increased by 22% and 24% respectively, CBRE noted.

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