Dubai’s real estate sector experienced exceptional growth in 2024, with sales values reaching AED 522.5 billion ($142.2 billion), a 27 percent annual increase. The latest report by fäm Properties also revealed that the market recorded 181,000 sales transactions, reflecting a 36 percent annual surge.
This stellar performance has cemented Dubai’s position as a global leader in real estate, offering some of the highest returns on investment globally. According to DXB Interact, investors earned AED100.5 billion ($27.36 billion) from the sector, highlighting Dubai’s appeal as a property investment hub driven by robust demand, innovative developments and government-backed incentives.
Factors driving investors to Dubai
Several factors are driving investors to Dubai’s real estate sector, including:
Strong economic growth
Dubai’s economy continues to record impressive growth. In the second quarter of 2024, the city’s economy grew 3.3 percent year-on-year to reach $31.6 billion. Second-quarter growth brought the total GDP in H1 2024 to AED231 billion, a 3.2 percent growth rate from the first half of 2023, reflecting steady growth across most sectors.
The real estate sector also experienced a growth of 2.6 percent in the second quarter of 2024, accounting for 8.7 percent of Dubai’s GDP with a total value of AED10.15 billion and contributing 6.9 percent to growth.
High returns on investment
Last year, affordable apartments in areas such as Dubai Investments Park (DIP), Discovery Gardens and Liwan offered the highest yields of 9 percent to 11 percent, according to Bayut.
Mid-tier communities including Living Legends, Motor City and Al Furjan have recorded ROI percentages above 8.7 percent. Meanwhile, luxury apartments in Al Sufouh, Green Community and Al Barari have reported rental yields between 7 percent and 9 percent.
For villas, Dubai Industrial City, International City and DAMAC Hills 2 have led the affordable segment with ROIs above 6 percent. Mid-tier villa communities, including Jumeirah Village Circle, Al Furjan and Jumeirah Village Triangle, offered returns of 6 to 8 percent. Meanwhile, luxury villa communities including The Sustainable City, Al Barari and Tilal Al Ghaf recorded ROIs exceeding 6 percent.
Population growth
Population growth rates remained a positive factor, peaking in 2024 with a 4.66 percent increase, reflecting higher migration and economic activity. Over 5 years, Dubai added approximately 470,000 residents, emphasizing the city’s sustained attractiveness for relocation.
With projections estimating Dubai’s population to reach 7.8 million by 2040, the real estate market is well-positioned to capitalize on sustained growth. In 2025, Dubai’s population is expected to reach 4 million which will likely drive strong demand growth across all real estate segments.
Tourism surge
Tourism remained a cornerstone of Dubai’s economic success. Between January and November 2024, the city welcomed 16.79 million visitors, marking a 9.2 percent year-on-year growth. This significant rise underscores Dubai’s appeal as a global destination for leisure, business, and innovation.
Dubai primary market sales grow 51 percent
In the primary market, first sales from developers climbed by 30 percent year-on-year to AED334.1 billion in 2024, highlighting strong demand for new developments and off-plan properties. The transaction volume surged by 51 percent to 119,800 in 2024, reflecting a substantial increase in investor confidence and developer activity. There was also a steady appreciation in the average price per sq ft, which was up 10 percent to AED1,600.
Demand was fuelled by new project launches and favorable payment plans, as the segment attracted foreign investors, supported by residency incentives and visa reform
In the primary market, Al Barsha South 4 was the top-performing area in terms of overall volume, with 12,878 first sales from developers, reflecting its popularity among investors and end-users.
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Secondary market sales grow 21 percent
Dubai’s secondary real estate market saw healthy demand last year, recording a 21 percent increase in re-sales to AED188.1 billion. Transaction volume was also up by 14 percent to 61,100, demonstrating sustained activity. The average price per sq ft also increased by 12 percent year-on-year to AED1,300.
“The 2024 re-sale figures reflected buyers shifting to ready properties for immediate occupancy, and high rental yields attracting investors, while infrastructure improvements enhanced property desirability. Sales values broke historical records, and with strong rental demand, and luxury resilience, the market continues to attract global investors, reinforcing its status as a top real estate destination,” said Firas Al Msaddi, CEO of fäm Properties.
Business Bay maintained its dominance in re-sale transactions, recording 5,142 deals during the year, while Dubai Marina led in overall value, with 4,924 transactions worth AED15.2 billion, emphasizing its status as a premium, waterfront destination.
Other popular areas in the re-sale market included Al Barsha South Fourth, Al Thanyah Fifth, Al Merkadh, Downtown Dubai, and Jabal Ali First.
