The instability of the global economy and politics, as well as the generally sluggish summer season, had no detrimental influence on Dubai's property market, which finished the third quarter of 2022
on a strong note, extending the growth and recovery period to 23 months since bottoming out.
Property price per square foot rose by 4% when compared to the previous quarter, and it is now 16% higher than it was during the same period the previous year.
Real estate transactions climbed by 14% quarter on quarter and by 61% year on year.
Despite several interest rate increases by the UAE's central bank, mortgage activity increased during the quarter, boosted by refinancing and bulk mortgage transactions.
Mortgage volumes increased by 9% from the previous quarter and by 185% year on year, while cash transactions decreased by 2% from the previous quarter but remained 86% higher than the previous year.
Secondary market (ready property) transactions were steady as compared to the previous quarter , yet 52% higher than the previous year. On the other hand, primary market (off-plan) transactions grew by 31% quarter-over-quarter and 74% year-over-year as a result of a surge in new development launches by property developers catering to the recent increase in demand from high-end luxury property buyers.
As we dissected the demand for prime and superprime properties, we observed the following:
Transaction volumes for properties valued at AED 10 million or more surged by 9% quarter over quarter and by 34% year over year.
Transaction volumes for properties valued at AED36.5 million (USD 10 million) and above registered no change compared to the previous quarter but were 88% higher than the same period in the previous year.
The number of transactions for properties with a value of AED 100 million (USD 27.3 million) or more increased by 33% from the previous quarter and by 300% from the previous year.
Business Bay, Downtown, and Damac lagoons recorded the highest number of transactions during the quarter, whereas palm Jumeirah registered the largest value of transactions during the quarter, demonstrating a strong demand for prime property.
There were a total of 593 transactions, and their combined worth was 5.6 billion AED.
Furthermore an eight-bedroom villa on Palm Jumeirah sold for AED302 million on July 5th, shattering the previous record for the highest value residential property transaction.
As it has been forecast in our previous report, the performance of commercial property is catching up with that of the residential market. As a result, office retail transactions climbed by 21% quarter over quarter and by 75% year over year.
During that quarter, Business Bay was also the most sought-after area for commercial property .
The optimism of property developers was mirrored in supply statistics, with 31,000 units added to the market's inventory since the beginning of the year, the highest since 2018.As developers prepare to announce the launch of new master communities or restart development on some major on-hold communities, such as Nakheel's palm Jabal Ali, we anticipate an increase in the number of releases in the upcoming quarters. To continue on their present trajectory, it is imperative that developers study the market under a microscope and release just what meets current demand and contributes to the city's future growth.