Dubai Real Estate Sector Anticipates Further Growth in 2024
The real estate sector in the Gulf region (GCC) is expected to maintain its upward momentum, supported by strong macroeconomic fundamentals, government policies, and growing investor interest, according to real estate market analysts at the Kuwait Financial Center (Markaz).
Positive forecasts are based on a thorough assessment of key macroeconomic indicators such as GDP growth rates, fiscal policies, and oil market dynamics.
Markaz’s real estate macroeconomic index estimates for the UAE, Kuwait, and Saudi Arabia in the second half of 2024 are projected at 3.7, 3.5, and 3.6, respectively. The UAE maintains a steady score of 3.7, while Kuwait and Saudi Arabia show an increase from the first half of 2024, ranging from 2.9 to 3.55, reflecting sustained stability and potential for stable growth in these key GCC real estate markets.
The UAE real estate sector is poised for further growth leading up to 2024, driven by stable demand across residential, office, and hospitality segments as detailed in the latest UAE real estate report.
It is expected that the non-oil economy, including the significant contribution of the real estate sector, will maintain high growth rates, supported by government backing and favorable policies, such as revised requirements for “golden visas” in Dubai aimed at raising investor qualifications, as stated in the report.
Despite geopolitical uncertainties slightly clouding economic perspectives, the real estate market remains dynamic with record transactions and price growth. In the first quarter of 2024 alone, residential property prices in Dubai and Abu Dhabi showed impressive year-on-year increases of 18.3% and 8.6%, respectively, solidifying the UAE’s position as a competitive market for luxury housing globally.
Furthermore, it is expected that the easing of the minimum AED 1 million initial deposit requirement for obtaining “golden visas” will further stimulate the real estate market by attracting more international investors.
“Office spaces in Dubai and Abu Dhabi also witnessed a growth in rental rates due to high demand, especially for higher-class properties, reflecting a market trend towards quality,” write analysts.
The UAE hospitality sector continues to prosper, supported by a surge in tourism and business travel, contributing to sustained average daily rates in hotels in major cities. Based on a comprehensive analysis of various macroeconomic factors, it is expected that the UAE real estate sector will maintain its growth trajectory in the second half of 2024, albeit with slight slowdowns in specific segments and areas, note Markaz analysts.
“The market’s stability indicates a well-supported economic environment and proactive policy measures ensuring sustainable growth and investment attractiveness,” they specify.