Will Dubai Property Prices Rise in 2023?

Dubai real estate is sizzling, but prices will continue to climb as the bull market continues.

The 'Dubai impact' that attracts local and international investors stretches beyond ROI.

Since the beginning of 2022, Dubai's real estate prices have been rising at an unprecedented rate. According to the Dubai Land Department, the second quarter of 2022 saw the largest quarterly volume of sales transactions during the previous decade, with 22,504 transactions totaling AED59.154 billion. Since the end of 2020, prices have been on an upward trend, with a steady and more pronounced increase this year.

But what is it about Dubai that makes investors desire a piece of the action? Are they only interested in a great return on investment? While return on investment (ROI) is the top priority for any investor, Dubai's overall success and prestige on the international scene has been one of the primary factors motivating investors to pick the Emirate as a place to live and invest.

The "Dubai effect" surpasses ROI. It is the result of the leadership's vision, the government's enabling efforts, the neutrality and inclusiveness of the policies, the safety of the nation, the luxury of the lifestyle, the friendliness of the people, and the opportunity and growth potential this land has to offer. This convergence in 'one solution' is what distinguishes the 'Dubai offering' internationally.

Dubai has made a systemic and rapid recovery from the pandemic, emerging stronger and quickly opening travel and investment routes. Hosting the World Expo, adopting virtual properties, introducing measures to increase foreign investment, and continuing to build infrastructure, lifestyle, and luxury services are all aspects that contribute to Dubai's status as a prominent global investment destination.

Dubai's general attraction to investors and tourists is accelerating the city's recovery from global economic and political instability and supporting the recovery of the real estate market.

As a result, the real estate industry has experienced significant growth since the start of this year. In the most established areas of Dubai, such as Emirates Living, Dubai Hills Estate, and Arabian Ranches, villa prices have doubled. In 2023, villas in Dubai are anticipated to continue to dominate the market. Key areas such as Palm Jumeirah will continue to rise in value, attracting investors and homeowners seeking a high return on investment and affluent living conditions.

In addition, apartment prices have increased by almost 25 percent since the beginning of the year. Since its introduction, the prices of waterfront condominiums such as Beach Vista at Emaar Beachfront have increased. Prices have increased by 30 to 40 percent in five-star hotels.

With current home price trends anticipated to continue until 2023, it is likely that the price increase will exceed pre-pandemic levels. According to data published by Reuters in September of this year, investors may anticipate a 3 percent average increase in property prices till 2023.

The final recipient is the investor. In some sections of the emirate, home rental rates have increased by more than 25 percent. During the years between 2002 and 2008, the property values of early investors increased by up to 300 percent.

During this time, Dubai became one of the fastest-growing real estate markets in the world. During this time, we began to observe the emergence of megaprojects, a growing investor appetite, and a more premium property offering.

Also increasing is investor interest in Dubai's off-plan property. Despite the spike in demand, the good news is that prices are still affordable and payment plans are still feasible for the majority of investors. All of these are indications of healthy expansion, which is essential for mitigating the impact of long-term price changes in the real estate industry.

Despite the current bull market, the city's overall housing sector has not yet achieved its 2014 peak level, particularly in the apartment category. Consequently, we are likely to witness continued expansion and a price increase.

Looking to acquire Dubai property?

The Pearl Gates has extensive expertise operating in the Dubai real estate market, assisting investors in acquiring assets that beat even the most robust growth cycles. We have extensive knowledge of all the mainstream and specialized developers working in the emirate and can assist you in making any purchasing decisions.

If you have questions about investing in Dubai real estate, please contact us at contacts@thepearlgates.com