This report will dive into the remarkable surge in residential property sales in Dubai, which reached a record-breaking AED 315 billion in total sales value, a 50% leap from the previous year, highlighting the sector's robust health and soaring investor confidence.
The government's strategic efforts to bolster Dubai's economy for the coming decade played a crucial role in enhancing the city's status as a prime location for both local and international investors. The introduction of new golden visa schemes, a welcoming business environment, and high rental and capital returns on property investments played an important role in the market, also reflected in the influx of new residents to Dubai, pushing the population up by over 100,000 to 3.65 million.
In 2023, Dubai's residential property market experienced its third year of continuous growth in transaction volumes, with a remarkable 36.35% increase. The year saw a record 118,011 units sold, the highest in a single year, although the growth pace in sales volume slightly slowed from the previous year's 65% as a result of increasing prices and mortgage rates in 2023. This peaked in September 2023, with 11,469 units sold, indicating a robust and evolving real estate market in the city.
2023 also saw the luxury segment of the Dubai property market reach new heights. The city outshone traditional luxury hotspots like London and New York, becoming the leading global market for homes priced above $10 million. This surge in luxury real estate, marked by a 76% increase in sales of units above the AED 10 million threshold, signalled Dubai's emerging status as a destination for high-net-worth individuals seeking luxury and exclusivity.
Off-plan sales transactions dominated the market in 2023, surpassing the sales of ready properties and accounting for 54% of all property transactions. The spike in off-plan sales was largely attributed to the scarcity of ready-to-move-in properties in the market. As a result, many buyers shifted their focus to investing in new developments which also offered attractive payment plans, a suitable alternative to mortgages with increasing interest rates.
This trend is particularly pronounced in the luxury segment of the market, where Dubai witnessed some remarkable transactions in 2023. Notable examples include the sale of a penthouse in Como Residences for AED 500 million and a transaction worth AED 420 million in Marsa Al Arab. These high-value transactions highlight the allure of Dubai's luxury real estate sector, where discerning buyers continue to invest in new developments that offer luxury amenities, unique experiences, and attractive payment plans.