UAE Real Estate Market Review Q4 2024

Key Takeaways

1. UAE GDP is forecasted to grow by 3.7% in 2024, with 2025 growth revised down to 4.2%, and 2026 up to 6.0%, reflecting the differing near and long-term assumption on the country’s oil production.
2. UAE government has moved to ensure the long-term sustainability of the real estate market, by implementing several new regulations in recent weeks aimed at improving transparency, expanding the addressable market, and in cooling the off-plan market.

Dubai

1. Against the backdrop of cyclical high office occupancy rates and continued rising rental values, Dubai’s commercial investment market has witnessed a significant jump in transactional activity over the past 12 months.
2. With supply now becoming increasingly tight across prime and secondary locations, leasing volumes are now being constrained with more limited large sized office transactions completed during the final quarter. 
3. The DLD have moved to further strengthen the regulatory environment of Dubai’s residential market with the launch of the new Smart Rental Index, which came live in January 2025.  This follows a period of strong rental growth, averaging 16% in the year to December 2024
4. Dubai’s sales market has also delivered another solid performance, with average values registering close to a 18% increase as compared to the year prior.
5. Supply remains incredibly tight across Dubai’s prime retail assets, with retailers currently struggling to fulfil requirements for new units across tier one assets such as Dubai Mall, Dubai Hills Mall and Mall of Emirates.

Abu Dhabi

1. Average office occupancy rates have continued to rise, ending the year at over 94%, with rental rates also moving in the same direction, jumping 15% year-on-year as Landlords have become increasingly bullish with position on new lease terms.
2. Abu Dhabi’s average apartment price registered a year-on-year increase of nearly 11%, with average villa values growing by close to 12% during the same period.  
3. In the residential leasing space, apartment rents increased by 12% in the year to Q4 2024, whilst average villa rentals grew by a more modest 4%.
4. Industrial rents have risen by around 8% during the last 12 months, largely driven by increased leasing rates across locations such as KEZAD, which has seen notably higher growth in rental values. 

Real estate markets continue to benefit from the country’s non-oil strength and sustained increases in inbound foreign capital.