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Dubai’s housing market experienced its most significant quarterly price surge in ten years due to heightened demand for real estate in the city, according to a report by property consultancy ValuStrat. In the third quarter, the ValuStrat Price Index (VPI) for Dubai’s residential market rose by 6.1%, with villa and apartment prices increasing by 7.6% and 4.8%, respectively. On an annual basis, the index saw a 15.1% increase, with villa and apartment prices rising by 19.8% and 11%. Notably, The Palm Jumeirah, Jumeirah Islands, Dubai Hills Estate, and Mudon recorded the highest capital gains in the villa segment, while Discovery Gardens, The Greens, The Palm, and Dubailand Residence stood out in the apartment category during the quarter.
Luxury real estate, referred to as prime properties, also saw significant increases in value during the third quarter. The report indicates that the valuations of prime properties rose by 16.5% annually and 6.6% on a quarterly basis. The ValuStrat Price Index (VPI) for prime villas hit a ten-year high with a 20.2% year-on-year increase and an 8.5% quarterly increase. Valuations of prime apartments increased by 13.6% annually and 5.2% quarterly. Dubai’s real estate market has staged a robust recovery from the pandemic-induced slowdown, driven by government initiatives like offering residency permits to retired and remote workers, along with the expansion of the 10-year golden visa program.
The growth of Dubai's property market was further bolstered by the economic benefits stemming from Expo 2020 Dubai and the rise in oil prices. Business activity within Dubai’s non-oil private sector remained strong in September, with sales growth reaching its highest point in over four years, indicating increased demand.
During the third quarter, Dubai saw 11,308 transactions for ready or secondary homes, marking a 17.7% increase compared to the same period the previous year. According to ValuStrat data, this translated to investments valued at Dh26.4 billion. The average cost of ready-to-move-in properties decreased by 1.4% annually to Dh2.3 million, and 41.5% of all ready home sales were priced below Dh1 million.
During the third quarter, the average price for completed units across the city reached Dh14,077 per square meter (equivalent to Dh1,308 per square foot), marking a 7.8% annual increase.
The majority of real estate transactions occurred in areas including Jumeirah Village, Dubai Marina, Business Bay, Downtown Dubai, and International City. As for off-plan homes, the average purchase price rose by 13% annually to Dh2.5 million, with the citywide average price per square meter for off-plan properties standing at Dh20,035.
Additionally, Mudon, Business Bay, and the Dubailand Residential Complex achieved record-breaking monthly transaction volumes during the third quarter, with the highest number of off-plan properties changing hands. The annual Increase in off-plan Oqood registrations saw a substantial 19.1% rise, equivalent to investments totalling Dh36.9 billion.
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