Dubai's real estate market is witnessing an unprecedented surge, with rents in prime residential areas expected to climb by 20% in 2024. This follows a remarkable growth of 23-30% in the past year, according to property experts. The increase is attributed to a mix of factors including heightened investor interest, a growing influx of professionals, population boom, and Dubai's allure as a destination for affluent individuals.
Ilnara Muzafyarova, head of Colife, a real estate management firm, notes that if the rate of new residents continues to outpace the availability of new homes, rental prices will keep rising. She predicts a 20% rise in short-term rentals and a 15% increase for longer-term leases in 2024. This trend is reinforced by the robust growth in apartment prices, which saw a 15% increase from mid-2022 to mid-2023.
S&P has forecasted a 5.0% to 7.0% rise in house prices during 2024, with Tatiana Leskova of S&P asserting no signs of a slowdown in Dubai’s property market. CBRE analysts have observed a 42% increase in rents since January 2020, with villa rents also spiking to an average of $88,400 per year.
The robust performance of Dubai's real estate market is also evidenced by the increasing property values and active high-rise building operations. For instance, Colife reported a 21.2% rise in monthly income for owners of one-bedroom units in Dubai Marina, with projections suggesting a potential increase to $3,415 per month in 2024.
Asteco, a real estate consultancy, indicated a moderation in the growth rate in the third quarter of the year, but annual changes still reflect significant gains in the rental market. Property Finder’s data shows a high demand for one-bedroom apartments and larger villas or townhouses, with a preference for furnished homes.
With Dubai’s population reaching over 3.6 million in July 2023 and projected to grow to 5.8 million by 2040, the demand for residential space in Dubai is expected to remain robust.