Rents in prime Dubai residential areas are poised to see up to 20 per cent in 2024 after a year of remarkable upswing estimated to be in the range of 23-30 per cent.
Property experts predict the sustained buoyancy for multiple reasons including increased investor appetite, rising influx of professionals, population surge, and the city’s growing appeal as a haven for the wealthy.
They said if net migration to Dubai continues to be higher than the rate that new homes are handed over, it will continue to put upward pressure on rental prices. Factors that could dictate the trajectory of rents in 2024 include more residents opting to buy rather than renting their homes, and the growing appeal of property as an attractive investment opportunity.
After a sharp uptick in rental prices by 23 per cent annually in the first half of 2023, and a year-end projection of around 30 per cent, the upward trend appears strong, according to Ilnara Muzafyarova, head of Colife, a real estate management firm. Muzafyarova predicted a 20 per cent jump in short-term rentals (up to 6ix months) compared to 2023, and a 15 per cent rise for long-term or above six months. This is anchored by the organic growth within the market, which has also seen a 15 per cent rise in apartment prices from mid-2022 to mid-2023.
In November 2023, S&P projected a 5.0 per cent to 7.0 per cent increase in house prices during 2024. Tatiana Leskova, associate director of Corporate Ratings at S&P, said there is no evidence of a slowdown in Dubai’s real estate prices this year.
Analysts at real estate consulting company CBRE said rents in Dubai have risen by approximately 42 per cent since January 2020, while house prices have increased by around 33 per cent. Villa rents have also experienced a similar trend, reaching an average of $88,400 per year, with a 19.2 per cent increase in average rent recorded in November.
Experts said the upward momentum in rents reflects the vibrancy of Dubai’s real estate market, with property values escalating alongside the operational high-rise buildings and property transactions surging.
Realty experts believe that given the continued influx of global professionals to Dubai, coupled with its population growth a sustained demand for residential space can be expected
