More than 32,000 residential properties, including villas and flats, will be delivered in Dubai by the end of 2023, real estate consultancy Asteco said in its Q1 2023 report, demonstrating the growth of the emirate's real estate sector and its post-pandemic resilience.

Despite growing concerns over future housing supply, 27,400 flats and 4,650 villas will be completed in the emirate by the end of the year. The report says the emirate will deliver 27,000 flats and 3,930 villas in 2022.

Despite this, the appetite for new project launches from investors and end users remains strong, the report added.

Dubai recorded the delivery of almost 7,600 units in the first quarter of 2023, which is comparable to the last quarter of 2022. Villa supply picked up significantly with some 2,150 units delivered, more than double the number in the previous quarter.

Villas continued to be the main focus, offering higher rents and occupancy rates. average rents for flats and villas continued to record strong growth in the first quarter of 2023, particularly in the higher quality developments, with quarterly increases of 4% and 7% respectively.

Annual price increases for flats and villas were up 17% year-on-year, with flats and villas increasing by 3% and 5% respectively.

Office rents have increased by an average of 6% over the last three months, with annual rent increases of 21%.

Astec expects the momentum in the Dubai property market to continue into 2023, albeit at a more sustained pace than in 2022.

Abu Dhabi

The UAE capital has a supply of around 1,600 residential units in the first quarter of 2023, mainly on Al Raha Beach, Al Reem Island and Saadiyat Island.

"With several new projects currently in the planning and design stages and expected to be launched during the year, Abu Dhabi's development pipeline for the remainder of 2023 shows no signs of slowing down," Asteco said.

While flat rents are showing stability, average rents for premium and quality flat developments increased by 2% in the first quarter of 2023. However, these increases were limited to new tenants.

The villa rental market continued its upward trajectory in the first quarter of 2023 with an average quarterly increase of 2%. Leasing rates in prime villa communities rose to 5%.

Sales prices for completed residential condominium and villa projects were broadly flat in the first quarter, despite an average increase of 2.0% over the past 12 months.

While sales prices in the off-plan prime and high quality project segments have risen sharply recently, they are still heavily discounted compared to comparable properties in Dubai, but represent "exceptionally good value".

The report notes that demand for office space in Abu Dhabi, particularly for A/B+ grade office space, remains strong, mainly in prime locations.