Year in Review 2023. Landmark events in the world of real estate in the UAE

The real estate market in the UAE is considered one of the fastest growing in the world. The Emirates continue to attract investors due to the loyal tax regime, transparency in obtaining documents and profitable investments in real estate. Let's summarize the results of this year and make a forecast for the next one. 

Analysis of the real estate market in the UAE in 2023 

Sales volumes 

Residential real estate sales volumes continued to grow in 2023. The growth rate was approximately 30% to 35% percent compared to the same period of the previous year. 

The most "failed" month this year was April. It was in it that the lowest sales volume in the market was recorded – $4.85 billion. However, the explanation for such a sharp drop in numbers is quite simple: the jump in sales volume was due to the slowdown in business activity during the Ramadan holiday. Of course, many people associated with the real estate market in Dubai were in a panic mood at the time. However, there was nothing to worry about: in June the market was fully recovered. 

July 2023 was recognized as the most successful month. This month recorded the highest volume of sales on the market – $8, 839 billion.*

New buildings or ready-made real estate 

According to experts, in 2023, sales of new buildings dominated - such real estate accounted for approximately 55% – 58%. The highest volume of sales of new buildings was recorded in July 2023 and amounted to $4.638 billion. Therefore, July was the best month for the sale of this type of housing.

Real estate price

In 2023, real estate price growth was uneven, with statistical outliers - both spikes and localized declines - established. Why did these occur? For example, spikes appeared as a result of sales of large expensive lots: huge villas, penthouses, etc. Especially many such sales appeared this summer. But from February to May the price of real estate "floated". 

In fact, transaction prices continued to rise this year, and the pace accelerated. This was influenced by changes in geopolitics and politics, as well as by sharp jumps in the exchange rate of the Russian ruble. 

–In October 2023, the average price for all property types was $3850 per square meter and increased by 5.3% in 10 months. 

–In November 2023, the average price for all types of real estate was $4127 per square meter and increased by 12.9%.

Luxury real estate 

Sales of ultra-expensive real estate for UHNWIs (Ultra High Net Worth Individuals) - super wealthy individuals - have multiplied since 2021. If in the period from 2010 to 2020, the average volume of such transactions amounted to about twenty-five per year, in 2022, he exceeded the figure of two hundred, and at the end of 2023 is expected to exceed the volume of sales of three hundred lots. In fact, Dubai has become the first world capital for sales of very expensive lots for multimillionaires in 2023 and has surpassed New York, Hong Kong and London.

Dispelling the main myth of 2023 

The main myth of 2023 was the information that Russians are losing their taste for higher-priced real estate in the UAE. Big real statistics on this subject never appeared: the media replicated the data of several local agencies, which have fallen in demand for housing sales. Agencies currently have only local statistics, which is based on a few percent or the total market. Official statistics, on the other hand, according to the Dubai Land Department, are released once a year - in January. Therefore, all we can know for sure is that Russians were the fourth in the list of top buyers at the end of 2022 with a share of 3.7% of all transactions.

At the end of the year we can say that Russians are still in the top 5 buyers of real estate in the UAE in 2023. 

– Q1 – third place.

– Q2 – third place.

– Q3 – fifth place. 

We can see that the Russians in the third quarter were not able to keep the leading position. This was primarily influenced by the collapsing ruble exchange rate. However, there are assumptions that Russians will remain in the top 5 buyers in 2023, but officially we will be able to find out in January 2024. 

Forecast for 2024 

Based on Knight Frank's forecasts for 2024, the rate of price growth in Dubai will seriously decrease – from 14% in 2023 to 5% in 2024, but Dubai will still remain the leader in price growth among world capitals in the luxury real estate segment. At the same time, the market as a whole will also continue to grow in terms of prices, but by a slightly smaller figure. According to analysts of the company – approximately by 3.5%. 

Instead of conclusion - the top events in the UAE for 2023 

– The sale of the most expensive penthouse of Como Residences, which took place in November 2023. 

– Five more billionaires moved to the UAE during the year, bringing the total number to seventeen now. 

– Dubai entered the top 10 most influential cities in the world in the GPCI 2023 ranking. 

– One of the world's largest solar power plants was launched in the UAE. It will provide energy to 200 thousand homes. 

– The UAE hosted the most important climate event of 2023. It was attended by more than 150 heads of state. 

*Data provided by REIDIN analytical platform