The property market in Dubai is experiencing unprecedented growth, with 2024 poised to be another record-breaking year in terms of sales figures and property values. Local real estate firms are noting a significant increase in demand, particularly in the luxury segment, which is driving up prices across the city. It is expected that the United Arab Emirates will retain its position as the world’s top wealth magnet for the third year in a row. However, this rapid growth comes with its own set of challenges and concerns.
Rising Property Prices and Demand
Hussain Sajwani, chairman of Dubai property giant Damac, has expressed apprehensions about Dubai becoming an expensive city due to the surge in demand. He highlighted the challenges faced by residents, such as difficulty in securing school seats and rising business costs leading to inflation. Sajwani emphasized the need for the government to address these issues effectively amidst a continuous influx of people into the city.
The latest data from Dubai’s property market indicates a significant uptick in demand. In July 2024, property sales soared to 49.6 billion dirhams ($13.5 billion), marking a 31.63% increase from the previous year. Elite Merit Real Estate reported over 43,000 property transactions valued at approximately AED122.9 billion in the first half of 2024 alone, demonstrating a 30% growth from the previous year. This growth is attributed in part to the rapid absorption of new inventory, with around 80% of units launched since 2022 already being sold.
Sajwani highlighted Dubai’s global appeal, particularly post-Covid, as a prime destination for living and investing. The emirate’s proactive measures during the pandemic, such as encouraging tourism and offering visas for remote workers and entrepreneurs, have further enhanced its attractiveness. Dubai has evolved into a global city, attracting talent and businesses from around the world, which has contributed to its continuous growth trajectory.
Despite experiencing a volatile boom-and-bust cycle in the past, notably during the 2008-2009 crisis period, Sajwani expressed confidence in Dubai’s current stability. He credited the stringent regulations implemented by the Dubai government post-2009 crash for ensuring greater stability in the market. These regulations have been instrumental in controlling the entry of developers and safeguarding the interests of customers, thereby preventing a repeat of the past downturn.
Dubai’s property market is witnessing a period of remarkable growth and demand, driven by domestic and international factors. While the surge in property prices presents challenges for residents, the city’s resilience and adaptability have positioned it as a global powerhouse for real estate investment and development. As Dubai continues to attract talent and investment, it is crucial for stakeholders to collaborate effectively in maintaining a balance between growth and sustainability in the property market.
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