Rising Rents in the UAE: Demand for Ready Properties Grows as More Tenants Turn to Ownership!

Source: Khaleej Times

In the first quarter of 2024, the demand for ready-to-move-in properties in the UAE surged as more tenants opted to become homeowners to escape rising rental prices.

According to data released by Property Finder, there was a notable shift in the first quarter of 2024 toward ready properties in both Dubai and Abu Dhabi, contrasting with the first quarter of 2023, which saw higher volumes of off-plan transactions.

Approximately 16,600 off-plan sales transactions were recorded in Q1 2024 compared to 16,000 in Q1 2023. Off-plan sales accounted for 46 percent of the total transaction volume in Q1 2024, down from 52 percent in the same period in 2023.

Rental prices have consistently risen over the past three years following the pandemic, and this upward trend is expected to continue in 2024 due to unprecedented demand driven by population growth. Faced with soaring rents, UAE residents are increasingly purchasing homes in Dubai and Abu Dhabi, helping them save on rental costs while benefiting from potential property value appreciation.

“2024 marks the beginning of an exciting and promising growth phase. We’re witnessing more diversified demand, and we’re optimistic about its positive impact in the coming months,” said Cherif Sleiman, Chief Revenue Officer at Property Finder.

Data revealed that the ready property market in Dubai recorded nearly 19,600 transactions in Q1 2024, representing 54 percent of the total transactions, compared to about 15,000 transactions (48 percent of the total) in Q1 2023. This reflects a remarkable 30 percent increase in volume compared to Q1 2023.

With a value of AED 78.2 billion, ready sales transactions contributed 68 percent of the total transaction value in Q1 2024, up from 60 percent in Q1 2023. This marks a significant 46 percent increase in transaction value compared to AED 53.6 billion in Q1 2023.

Data from the Dubai Land Department (DLD) showed a substantial rise in total sales transactions in Q1 2024. The recorded transactions marked the second-highest ever for the quarter, with over 36,000 transactions compared to 31,000 in Q1 2023, reflecting a significant 17 percent increase.

Approximately 16,600 off-plan sales transactions were recorded in Q1 2024 compared to 16,000 in Q1 2023, accounting for 46 percent of total transaction volume versus 52 percent in the same period the previous year.