Exploring Real Estate Trends in 2024: Dubai vs Abu Dhabi

Dubai real estate is still home to “luxury and new entrants,” while Abu Dhabi real estate is starting to attract families seeking cultural and entertainment experiences.

Despite a dimming global picture, experts at JLL’s recent real estate Dubai event, “Navigating the Growth Spectrum: Exploring Strategies for Sustained Success,” projected that the UAE real estate market will continue to rise in 2024.

Strong economic fundamentals, government initiatives, and rising investor confidence in the UAE economy despite global inflationary pressures all contribute to the real estate sector’s expected strong performance in 2024, solidifying its position as the cornerstone of the UAE’s diversification agenda. According to James Allan, CEO of JLL’s Middle East and Africa division, the UAE’s development potential and better investment climate stabilise an unpredictable global environment, making it more appealing to domestic and foreign real estate investors.

Investors are drawn to lifestyle-focused buildings, health facilities, and branded residences in Dubai and Abu Dhabi. Developers would have more opportunities to provide cheap houses if there is a market for properties under AED 3 million. The most sought-after area is still an option for people looking to own an affordable unit, the statement claims, despite the rise in the number of luxury residences and cities. The residential sector is predicted to produce 34,000 units in Dubai and 8,000 units in Abu Dhabi real estate next year.

Real estate in Dubai and Abu Dhabi is in “high demand” for office space. The lack of Grade A space and an increase in inquiries were the main drivers of this year’s office rent hikes. With the shift in work habits, flexible office spaces become more and more popular. The industrial sector was strengthened by initiatives to increase manufacturing and logistics. There was a significant market for logistics and warehousing solutions. As shopping changes, malls are integrating e-commerce and introducing new features. Luxury businesses and F&B concepts are succeeding. 

According to the statement, Abu Dhabi is developing into a hub for family-friendly entertainment and culture, and real estate in Dubai is still witnessing “luxury and new entrants.” The rise of hospitality will be fueled by an increase in tourists and a well-balanced event calendar.

In 2024, real estate in Dubai is projected to grow by 46%

Based on the latest artificial intelligence technology study conducted by Realiste, housing and real estate in Dubai are predicted to reach a significant high in 2024, accounting for around 46% of the market. This is happening in contrast to the previous year when Dubai real estate prices increased by an average of 20 to 40 per cent. Economists predict that low-trending neighbourhoods such as Wadi Al Safa 4, Hessayan First, and al Yalayis will be among the most important areas to see this peak of growth. The reasons for this 46% increase, as well as the best investment prospects for 2024, are covered in greater depth below.

Dubai’s highlights

• The building and real estate sectors in Dubai started to recover in 2020 following the COVID-19-related decline. They had drop rates of 4.7% and 7.4%, respectively.
• Fortunately, the real estate market started to revive early in the next year, but by the beginning of 2023, the building sector showed more improvement.
• According to figures from the Dubai Statistics Center, in the first half of 2023, Dubai’s real estate market rose by 1.9% and 3.6%, respectively.
• Both sectors will account for around 14.4% of Dubai’s GDP in 2023. 

The Volume of All Sales Transactions in Volume

• The quantity of recorded sales transactions rose dramatically to 133,134 in 2023 from 96,459 in 2022.
• This shows a 38% rise, the best performance for a year ever recorded, due to the exceptional performance of the off-plan trades.
• Transactions involving real estate in 178 sites in Dubai in 2023 55.2% of the transactions took place in ten regions, with Al Barsha South Fourth coming in first place. It accounted for 10.7% of total sales. 

The Greatest Attributes of Abu Dhabi

• Abu Dhabi’s economy did well in 2023, thanks in part to the growth of the non-oil sector. This industry grew by around 6% in the first half of the year.
• The industrial sector accounted for more than 8% of Abu Dhabi’s GDP, growing by 5.6% in Q1 and 12.4% in Q2.
• Abu Dhabi’s building and real estate sectors grew by around 13.4% YoY in the first half of 2023, accounting for 12% of the nation’s GDP.
• The construction industry is considered to be the main engine of the sector’s progress, accounting for 17% of the increase in the first half of the sector and around 8.5% of the GDP overall.
• But the real estate activities industry grew by 5.7% in the first half of 2022 compared to the same period in 2022.

Total Sales Transactions for 2023

• The overall number of sales transitions in Abu Dhabi increased significantly: according to Department of Municipalities and Transport (DMT) statistics, both residential and commercial space will be used in 2023.
• Up from 7,602 in 2022 to 13,298 this year, the number of transactions established a record. This suggests a 75% rise.
• It makes up around 85% of the overall value and 97% of the volume of residential transactions.
• The transaction value showed a notable 120% jump from AED 19.9 billion in 2022 to AED 44 billion.
• Increased transactions show investor confidence in Abu Dhabi’s real estate market. This growth might also be linked to government initiatives to improve the business environment and regulations, rendering the region a more alluring investment destination.

Final Words

Purchasing real estate in the UAE, regardless of the emirate you select, maybe a fantastic opportunity if you act quickly enough. Choose the emirate that best meets your investment requirements by using the information above and further investigation. Contact Real Tree Real Estate to learn more about investment property options in Abu Dhabi and Dubai. Our knowledgeable advisors are prepared to help you make the ideal decision.