Dubai rents increasing at incredible rates since October 2014
From skyscrapers to man-made islands, from the world’s largest shopping malls to the world’s best theme parks, and from towering apartment developments to marvellous villas, Dubai holds a supreme share of concrete treats. At the same time, it is also true that Dubai real estate market has undergone a massive shift in terms of development. From single-story houses near the creek to the vast stretches of contemporary real estate developments, the city has beautifully evolved.
Even after the COVID-19-induced global pandemic, the sector has emerged victorious in terms of demand and growth. Seeing its resilience, a large number of local and international investors have been preferring to invest their hard-earned money in this market, compared to its peers and fully-established global residential markets.
Dubai real estate market at a glance
According to CBRE – a US-based real estate firm, the total volume of transactions in Dubai’s residential real estate market touched 7,941 in June, which is 33.3 percent up compared to 2021 data. The growth in the number of transactions is driven by both off-plan and secondary market sales.
Upon further quarrying, it is found that off-plan property sales increased by 46.7 percent in a year and secondary market sales increased by 24.4 percent. Total transaction volumes in the year 2022 to June reached 38,901 – which is the highest total recorded so far since 2009 over this period. On average, prices of apartments for sale in Dubai have reached AED1,103 per square foot and villa prices stood at AED1,324 per square foot. Average prices of **properties for sale in Dubai **have increased by 10.1 percent in the current year to June 2022. The average prices for apartments increased by 8.7 percent and average prices for villas rose by 19.3 percent.
If these rates are compared to the highest values witnessed in late 2014, these rates per square foot are 25.8 percent and 8.3 percent below the peak, for apartments and villas respectively.
Highest performing areas
When it comes to finding the best areas for properties for sale in Dubai, a few names top the list. For instance, Jumeirah recorded the highest average sales rate per square foot at Dhs2,079, for apartments. Palm Jumeirah recorded the highest average sales rate per square foot at Dhs3,365, for villas.
Dubai rental market – A bird’s eye view
The costs of rent in Dubai have been increasing at the fastest rate in the year 2022, compared to the late 2014’s values. Average rents for residential properties in dubai have increased by 21.7 percent, in the last 12 months to June 2022, as property prices see moderate growth in recent months.
According to CBRE, average rents for apartments in Dubai increased by 21.2 percent in the same period, while villa rents rose by 24.7 percent on average. Average Dubai apartment and villa rents touched AED85,294 and AED255,437 per annum respectively.
Highest performing areas
According to this report, the most expensive apartment rental units are in Palm Jumeirah, where the average asking rent touched AED218,413 per year. For villas in Dubai, Al Barari took the lead, where asking rents were around AED889,225 in a year.
Taimur Khan, CBRE’s Middle East head of research stated, “While the rate of price growth has tapered to 10.1 percent in the year to June 2022, the rate of rental growth continues to accelerate, where rents increased by 21.6 percent over the same period. Rents, on average, are increasing at the fastest rate since mid-2014.”
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