Dubai Leads Global Prime Residential Market in Rental Values in H1 2024: Savills
Dubai continues to dominate the global prime residential market with exceptional rental and capital value growth in the first half of 2024. According to Savills’ latest Residential World Cities Index, Dubai ranks at the top among 30 global cities for rental value growth.
Impressive Rental Value Growth
Dubai led the index with a remarkable 12.1% increase in rental values during H1 2024, surpassing Bangkok (9%) and Lisbon (7.5%). This growth is attributed to strong lifestyle credentials and corporate relocations driving demand in these cities.
Capital Value Growth
In addition to rental values, Dubai ranked 5th globally for capital value growth, increasing by 2.9% in the first half of 2024. This underscores Dubai’s robust real estate market, attracting investors and residents alike.
Factors Driving Demand
Savills highlights that Dubai’s prime real estate rents have been on a multi-year upswing due to pro-business government policies and attractive residence visa programs. These factors have drawn people worldwide to establish their base in Dubai.
Record-Breaking Transactions
Head of Residential Agency at Savills Middle East, noted that Dubai’s residential market continued its impressive performance in the first six months of the year, with record-breaking transaction volumes and values. He emphasized the ongoing launch of world-class projects by leading brands and developers in Dubai and the wider UAE to capitalize on growing demand.
Tight Supply and Prime Rentals
Cummings also mentioned that with existing supply running tight, prime rentals are unlikely to cool off anytime soon. The demand for high-quality rental properties continues to exceed supply, supporting rental price growth across the region.
Dubai, Lisbon, and Bangkok as Market Leaders
Associate Director at Savills World Research, stated that Dubai and Lisbon have consistently been leaders in prime rental market growth due to excess demand for high-quality properties. Bangkok is a new entrant in this trend, further boosting its rental market.
Resilience of Prime Residential Property
The report notes that prime residential property in world city locations remained resilient over the first half of 2024, recording an average capital value growth of 0.8%, outperforming the 0.6% growth predicted for the year. However, buyers remain cautious as they await clarity on interest rates.
Dubai Offers Immense Value
On a price per square foot basis, Dubai continues to offer immense value to investors and end-users seeking high-quality, luxurious homes with attractive amenities. Coupled with the emirate’s lifestyle and connectivity, Dubai remains one of the world’s most coveted destinations to live in.
EMEA Market Insights
Across many EMEA markets, demand continues to outstrip supply for prime rental properties, supporting rental price growth across the region. The report indicates that in a higher interest rate environment, rents outperformed capital values, growing by 2.2% in the first half of the year.
Savills further notes that renting provides international tenants with the flexibility they desire when entering a new market, contributing to these increases. Notably, no EMEA market tracked in the index saw rental prices fall from December 2023 to June 2024.
The UAE real estate market, led by Dubai, continues to demonstrate exceptional growth and resilience, driven by demand for prime properties and supported by favorable government policies and economic conditions.
Reference: Arabian Business
