More tenants are turning into owners in UAE, increasing the demand for ready properties

More tenants are turning into owners in UAE, increasing the demand for ready properties

In the first quarter of 2024, the demand for ready properties surged in the United Arab Emirates, driven by an increasing number of tenants opting for ownership over rising rentals.

Unlike the first quarter of 2023, which witnessed a surge in off-plan transactions, the first quarter of 2024 saw robust demand for existing projects in both Dubai and Abu Dhabi, according to data released by Property Finder.

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Following the pandemic, rents have steadily risen over the last three years. With the growing population fueling extraordinary demand, it is expected that this upward rental trend will persist in 2024. Consequently, UAE residents are transitioning towards purchasing real estate in Dubai and Abu Dhabi to reduce their monthly payments and capitalize on property appreciation.

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“2024 has ushered in an interesting and promising phase of growth. We observe a more diversified demand, and we are optimistic about its implications in the coming months,” stated Cherif Sleiman, Chief Revenue Officer of Property Finder.

In Dubai, the existing/ready market recorded nearly 19,600 transactions in the first quarter of 2024, representing 54% of all transactions, up from approximately 15,000 transactions in the same period the previous year. This marked a significant 30% increase in volume compared to Q1 2023.

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Transaction values in Q1 2024 constituted 68% of the total sales transaction value, amounting to Dh78.2 billion, compared to 60% in Q1 2023. The current/ready transaction value surged from Dh53.6 billion in Q1 2023 to Dh46.6%, reflecting substantial growth.

The Dubai Land Department (DLD) reported a notable increase in the total number of sales transactions in Q1 2024, with over 36,000 transactions, up from 31,000 transactions in Q1 2023, indicating a remarkable 17% increase.

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In Abu Dhabi, real estate recorded 814 residential transactions in Q1 2024, accounting for approximately 38% of all transactions, a significant rise from 628 transactions in Q1 2023. The existing/ready transaction value contributed Dh1.74 billion, or 29%, to the total sales transaction value.

Although the number of residential sales transactions slightly decreased to around 2,145 transactions compared to 2,286 transactions in Q1 2023, there was a notable 20% decline in the off-plan market volume year over year, indicating a shift towards ready properties.

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Overall, the surge in demand for ready properties in both Dubai and Abu Dhabi reflects a growing preference among tenants to transition into property ownership, signaling positive momentum in the UAE real estate market for the foreseeable future.

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