UAE REAL ESTATE MARKET FOR JUNE 2022

When speaking about the UAE real estate market, the summer is off-season period. It means it’s time to summarize the half-year property market results.

Highlights of June

The first half of 2022 was a high-water mark for Dubai’s real estate market; more than 43,200 real estate transactions were recorded. And that’s 71% of all real estate transactions for all of 2021. Their total amount reached $31.3 billion. In Abu Dhabi – $6 billion.

Prices have also risen. On average, in the emirate, a residential real estate 1 sq m is $ 3,341 at the end of the first half of 2022. It is 23% over the same figure in 2021.

The UAE Central Bank has raised its bank key rate by another 75 main points: up to 3%. And it is planned to increase at least until the end of 2022.

Moreover, thanks to the innovations, tenants are able to pay their checks through their bank accounts and credit/debit cards directly.

June presented a broader view of the overall migration to the country, especially from wealthy buyers. So, 2022 is projected to be the most successful year for millionaire migrants, especially from the U.S.A., the U.K., and Russia. The latter were the largest investors in the UAE in the first half of the year.

Chinese investors coming back

Acoording to the prevailing circumstances in the world, the second half of the year will be dictated by a massive chinese investors inflow.

As a reminder, investment from China in UAE real estate was around $463 million in 2018 and $1.06 billion in 2019.

For example, China’s Juwai IQI plans to invest more than $2 billion in the local economy. And there are hundreds of such companies. Note that Chinese investments are always more stable, structured, and long-term.

Luxury objects and mansions, villas and townhouses are considered by the Chinese as investment assets. And luxury apartments are chosen for living. Downtown Dubai, Emaar Creek Harbour, Business Bay, Meydan, and Dubai Hills are the most popular districts.

What about sales volumes?

June 2022 was also a record year for Dubai. Residential and commercial real estate accounted for 8,851 transactions, including mortgages. And 5,882 deals were apartments, and 1,988 were villas and townhouses of that amount. The rests were offices and land. June 2022 showed a 32.88% increase in the number of transactions.

There were only 7,474 real estate transactions in Abu Dhabi in the first half of the year, of which 3,906 came from mortgage transactions.

June Results

The total cost of real estate sold was $6.9 billion per 8,850 transactions. It is about 25% higher than in May 2022. The transaction value of apartments reached $2.96 billion, and villas and townhouses – $1.9 billion.

The average price of apartments is $326,700, up 21% over June 2021. And villas have fallen in value to $517,200 – a 30.4% drop from last year.

Commercial properties cost $226,000, a +10% year-over-year increase. And land plots have fallen in price down to $735,000. The total value of commercial real estate transactions was $124,556,000, and the land was $1.22 billion.

Consequently, the real estate market was enriched by $16.14 billion between April and June 2022. That’s an increase of 6.81% over the first quarter of the year.

In Abu Dhabi, there were 3,568 mortgage-free real estate transactions with a total value of about $2.42 billion. Mortgage deals (3,906) reached a total value of $3.7 billion.

Most expensive districts

The first half of 2022, Business Bay leads in real estate demand with 4,310 deals. The next one is Dubai Marina with 3,735 dealings. Al Hebiah Fifth, Jumeirah Village Circle, and Downtown Dubai follow with 3,150, 2,900, and 2,585 transactions, accordingly to it. Other popular areas were Al Merkadh (2,300), Dubai Creek Harbour (1,865), and Palm Jumeirah (1,145).

Such districts as Palm Jumeirah, Emirates Hills, District One, and Dubai Hills were the best performers. Each showed a growth of more than 4% by May 2022. The Palm Jumeirah has seen monthly increase of about 5% for three months in a row.

Dubai Silicon Oasis and Jebel Ali are leading in apartment sales. Real estate deals rose 3.6% and 4% in June, respectively.