Dubai rents increased at a record rate over the past 12 months, according to data published by global real estate analysts at CBRE.
Rents in both the apartment and villa sectors surged, making it Dubai’s highest rental growth on record.
Average rents increased by 28.5% in the 12 months to January 2023.
Dubai rent increases
Over the same period, average apartment rents have grown by 28.8% and average villa rents by 26.1%.
As of January 2023, the average annual apartment and villa rents reached AED 98,307 ($26,767) and AED 290,242 ($79,025), respectively.
Palm Jumeirah has registered the highest rental rates for both apartments and villas, with average annual asking rents currently standing at AED258,529 ($70,390) and AED1,032,763 ($281,192), respectively.
At the same time activity in Dubai’s residential market started the year on a strong footing as total transaction volumes reached 9,229 in January 2023, marking a growth of 69.2% compared to the year prior.
Over this period, off-plan sales grew by 88.1% and secondary market sales by 51.4%.
In the year through January 2023, average residential prices grew by 10.6%, with average apartment prices increasing by 10.3% and average villa prices increasing by 12.9% over the same period.
Average apartment prices in Dubai, as of January 2023, stood at AED 1,196 ($326) per square foot, and average villa prices stood at AED 1,411 ($384) per square foot.
As at January 2023, these average apartment and villa sales rates are still 19.6% and 2.4% below the high records witnessed in late 2014, respectively.
That being said, a number of communities have long surpassed their 2014 levels.
Jumeirah has recorded the highest sales rate per square foot, reaching AED 2,397 ($653) in the apartment segment of the market, whilst in the villa segment of the market, Palm Jumeirah posted the highest sales rate per square foot, reaching AED 4,104 ($1,117).
Taimur Khan, Head of Research – MENA at CBRE in Dubai, said: “Dubai’s residential market has recorded its strongest start to the year in terms of transaction volumes, with 9,229 residential transactions in January 2023, up 69.2% from a year earlier, its previous January high.
“This increased level of transactions has underpinned an uptick in the rate of price growth with average sales prices increasing by 10.6% in the year to January 2023, up from 9.5% a month earlier.
“Average rents have also continued to increase at a historic rate, where in the 12-months to January 2023 rents increased by 28.5%. While the annual rate of growth is at record highs, we are seeing that an increasing number of listings in core communities are starting to decrease their listed price, indicating that in parts the market is reaching its top.”
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