Dubai’s real estate sector will sustain an upward growth in 2023 as the investors and end-users will continue to pour money in the emirate’s residential segment sector amid strong belief in the bright prospects of the economy, Invest-Gate reports.
Real estate experts, analysts, leading executives and industry stakeholders say that tourism, visa reforms and labour reforms will continue to drive investment in the UAE’s real estate sector.
The forecast up to 10% increase in real estate prices in 2023 on the back of strong demand in luxury sector as high net worth individuals and millionaires are moving to Dubai because of its stable economy, successful strategy to contain the Covid-19 pandemic and erecting excellent infrastructure.
Haider Tuaima, director and head of Real Estate Research at ValuStrat, states that the latest report suggests that there is a 7-10% average increase in property prices in prime areas.
“The ValuStrat Price Index saw 2022 general home prices 12.7% over 2021. The VPI for prime properties increased by 14.7% during the same period,” Tuaima notes.
Tuaima points out that the current 7-10% forecast represents the projected annual increase of overall prices, prime and non-prime properties within the freehold real estate market in Dubai.
Deloitte on Saturday predicted further growth for Dubai and Saudi real estate markets this year and said strong recovery in tourism sector will benefit both the markets in the region.
In its ninth annual Middle Estate Real Estate Predictions 2023 report, the consultancy provides a positive outlook for 2023 and said all real estate segments such as hospitality, residential, retail, commercial office space and industrial will perform better this year.
“2023 is expected to see this trend decelerate further, with some locations already reaching possible price ceilings and may witness negative growth where excess supply is anticipated,” Tuaima says.
For his part, Ata Shobeiry, chief executive of Zoom Property, clarifies that the Dubai property market is expected to grow further in 2023, ably supported by local and foreign investors.
“The market is already getting a lot of traction due to the high interest from high-net-worth individuals. This trend is expected to continue in 2023. These reasons, along with the government’s support, will help Dubai real estate to have reasonable growth, particularly during the second half,” Shobeiry further notes.
In addition, Nikita Kuznetsov, chief executive of Metropolitan Premium Properties, states that the current and projected market conditions are in favour of owners of Dubai residential properties, especially in sought-after locations such as the coastal areas — Dubai Marina, Jumeirah Beach Residence, Bluewaters, Beachfront, Palm Jumeirah and Port de la Mer.
“All indications are that real estate stock is king and owners of Dubai residential property find themselves ideally placed to make the most out of their investment, as it is estimated that the city’s population will rise from today’s 3.5 million to 5.8 million by 2040,” he adds.
“This year, leading developers are expected to launch several projects and we can expect to see a 30-40 per cent increase in the number of new projects that will be announced,” Kuznetsov notes.
As regards the secondary market, Kuznetsov expects that the market will continue its strong upward trajectory as there is considerable demand for ready properties. We can see that from the number of AED 100 mn+ deals that were completed last year.
“In 2023, prices will continue to increase but we are not likely to see the same rate of increase as last year. The price increase will be driven by demand for ready-to-move-in apartments and villas due to a combination of a growing population of long-term residents and spiking interest by international HNWIs looking to invest in second homes,” Kuznetsov concludes.
