September 2024 marked another significant month for Dubai's real estate market, continuing its post-pandemic momentum with record-breaking sales and an uptick in mortgage activity. Property prices moderated, reflecting healthy market dynamics, while off-plan developments surged, pushing the market towards new highs. Here's a breakdown of the key trends shaping Dubai's property landscape.

Record-Breaking Sales Transactions

September witnessed the highest-ever number of sales transactions, totaling 18,038, an 11.7% increase from the previous month. This not only makes it the highest September on record but also the most active month in the history of the Dubai real estate market. Residential properties dominated, accounting for 95.1% of the sales, with apartments, townhouses, and villas leading the way. The commercial sector, although smaller, saw significant activity, with office spaces leading the charge.

Annual sales transaction volumes have now surpassed 131,000, just 1.9% below the entire 2023 year-end total. With three months left in 2024, the market is on track for a near 30% increase in total sales compared to 2023, a remarkable recovery and growth trajectory. By year-end, the total number of sales is expected to approach 170,000, marking a fourfold increase from pre-COVID levels.

This impressive performance is a testament to the resilience of the Dubai real estate market, fueled by government initiatives and a proactive approach to market evolution.

Property Prices: Moderation Returns

After a sharp price surge in August (2.48%), September saw property price appreciation return to a more moderate pace, with a 1.14% month-on-month increase. Property prices in Dubai now stand at AED 1,448 per square foot, up 17.4% from the previous peak in 2014. This brings the overall market growth since the bottom of the cycle in late 2020 to an impressive 57.9%.

The more restrained price growth in September reflects the dual nature of Dubai’s real estate market, where off-plan property launches and sales fluctuate more dramatically than ready properties. This balancing act helps maintain a healthy market equilibrium, avoiding the risk of overheating despite rising demand.

Off-Plan Developments Continue to Surge

The off-plan market remains robust, with 11,812 off-plan sales transactions recorded in September, representing a 12.9% increase from the previous month. Off-plan transactions now account for 65.5% of the market, and after adjusting for technicalities, this figure jumps to over 72%. This rise in off-plan activity is driven by a steady flow of new project launches and increased developer activity.

In total, more than 13,500 new off-plan units were launched in September, adding an estimated AED 28.9 billion in value to the market. This brings the year-to-date total to nearly 100,000 units, surpassing last year’s launch volume. While the aggregate sales value slightly lags behind 2023, the broader range of project price points launched this year suggests a more diverse offering, catering to a wider spectrum of buyers.

Outlook for Q4 2024

As Dubai enters the final quarter of the year, the market is expected to maintain its upward trajectory, driven by steady price growth and strong transaction volumes. However, it is crucial that price appreciation remains in check, ideally below the 1% mark, to avoid concerns about market overheating. While price increases are expected, sustained monthly growth above 2% could raise alarm.

The gap between off-plan and completed property sales is also likely to widen, as the off-plan pipeline remains strong and competitive. Developers are increasingly launching new projects across various price segments, ensuring diverse offerings for buyers. However, the rise in off-plan resales, particularly for properties nearing completion, warrants careful monitoring to avoid speculative activity that could negatively impact supply and pricing.

Conclusion

September 2024 was a landmark month for Dubai's property market, demonstrating not only record-breaking sales but also a healthy moderation in price growth and continued strength in off-plan developments. The positive momentum in mortgage activity, combined with high-value transactions and a growing inventory of off-plan units, highlights the ongoing resilience and attractiveness of Dubai real estate. Looking ahead, as long as price appreciation remains controlled, the market is well-positioned for sustained growth into 2025.