Villa and apartment prices in Dubai continue to show signs of stabilization through the end of 2022, with citywide growth of around 7% to 10% still to be recorded this year due to strong demand for quality properties, according to a report by ValuStrat.
The ValuStrat Price Index (VPI), which tracks the market performance of residential properties across the emirate, slowed to a monthly increment of less than 1% to 86 points in the last four months of 2022.
Most freehold locations have also witnessed little or no change in capital values over the past 12 months.
"Dubai's residential market [is] showing signs of price stability," said the report released on Friday.
Overall, residential capital values increased by 12.7 percent year-on-year, while rental values increased by 25 percent year-on-year.
Last November, ValuStrat reported that apartment prices in Dubai were beginning to stabilize after several months of strong growth.
Gold Market
While prices may be stabilizing, ValuStrat expects residential property prices in the city to increase by an average of 7 to 10 percent by the end of the year.
"This is largely driven by the prime market - villas in general. The rest of Dubai's residential market has reached its likely price ceiling and may experience negative growth in some areas where new supply is expected," Haider Tuaima, director and head of real estate research, told Zawya.
In the fourth quarter of 2022, off-plan sales jumped 112.1 percent to 15,071 transactions, while the number of ready-made unit transactions increased 37.3 percent to 11,165.
Dubai expects to see an increase in visitor volumes this year following the lifting of COVID-19 restrictions in China, the emirate's main source market for tourism.
Dubai will also receive a boost from the upcoming COP28 conference, which will host 140 heads of state and government leaders and more than 80,000 delegates.
According to ValuStrat, the newly launched UAE Tourism Strategy 2031 is also likely to boost tourism investments in various related sectors, including tourism, aviation and hospitality.
