The Dubai real estate market in 2023 and looking ahead into 2024 presents a complex and dynamic landscape, marked by continued growth, albeit at a moderated pace compared to previous years. Here's a detailed analysis based on recent trends and forecasts:

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Market Overview and Forecasts

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Growth Expectation: The Dubai property market is expected to continue growing in the next 18 months. Property prices are predicted to rise, albeit more slowly than in the past three years. Rental prices are also forecasted to increase. The GDP growth for Dubai in 2024 is expected to be around 2-3%.

Transaction Volumes and Values: From 2019 to 2023, Dubai's real estate market has shown a sustained pattern of growth. In 2022, the market experienced a significant surge, with 120,000 real estate transactions valued at AED 500 billion. Early 2023 trends indicate a continuation of this momentum.

Key Drivers of Growth

• Non-Oil Sector Performance: The UAE's economy, particularly the non-oil sector, has shown robust growth, which is vital for the real estate market. The non-oil sector is expected to grow by 4.5% in 2023.
• Government Initiatives: UAE government efforts, including reduced transaction fees and long-term residency visas, are stimulating foreign investment in the real estate market. The Golden Visa program is expected to attract more long-term investors and residents, bolstering the property market.

Residential Market Dynamics

• Property Demand: Demand for residential properties in Dubai remains strong, with a notable total of 62,200 apartment units transacted in 2022. Off-plan projects have been a significant driver behind this activity.
• Transaction Growth: In the first half of 2023, Dubai saw record-breaking transaction volumes, up 43.3% year-on-year. This surge in demand underpinned higher-than-expected price growth.
• Rental Market Trends: The growth rate of average rents in Dubai has moderated in the first half of 2023, but the overall trend remains positive.
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Sector-Specific Insights

• Office Market: In Dubai’s office market, demand remains strong, pushing occupancy levels to 92.7% in Q2 2023. However, the lack of available stock is impacting take-up. Rental rates have continued to rise across all segments.
• Hotel Sector: The UAE’s Average Daily Rate (ADR) softened year-on-year by 1.9% until June 2023. However, occupancy rates increased more than expected, driving up Revenue per Available Room (RevPAR).

Conclusion and Outlook

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The Dubai real estate market in 2023 and 2024 is characterized by its resilience and adaptability to global economic conditions. Continued growth in property prices and rental rates is anticipated, driven by a strong non-oil sector, positive government initiatives, and sustained international interest. The residential, office, and hotel sectors are showing robust performance, despite global economic headwinds. The outlook for the Dubai real estate market remains positive, underpinned by a strong economic foundation and proactive government policies aimed at stimulating the market.