Lifestyle trends and personal preferences continue to shape Dubai’s real estate market, reflecting the dynamic character of this cosmopolitan city. As demand rises and the pool of home seekers becomes increasingly diverse, distinct patterns emerge in what buyers desire in their ideal living spaces.
From houses boasting private pools to luxury villas equipped with outdoor kitchens, zen gardens, and dedicated wellness areas, homebuyers and renters are prioritizing features that align with their aspirations and lifestyles. Recent insights from Property Finder underline this shift, shedding light on the growing needs and desires of UAE homebuyers in addition to emerging trends in the rental market.
Key features that are rising in popularity
Proprietary data from Property Finder indicates that homebuyers and renters place a premium on amenities that enhance their lifestyle. More than 5.5 million home seekers wanted properties with a balcony. Meanwhile, 3.1 million prioritized larger spaces featuring a maid’s room. Central air conditioning followed closely behind with 2.3 million searches considering this a must-have.
Other common preferences include:
- Gyms: 1.5 million searches
- Pet-friendly spaces: 1.4 million searches
- Private pools: 1.3 million searches
- Homes with stunning water views: 1.3 million searches
Homebuyers and renters in Dubai are also increasingly looking for homes with barbecue areas, private jacuzzis and security systems.
Demand for property ownership grows
Property Finder also reveals that there is a growing demand for ownership opportunities in the UAE with over 65,500 manual searches this year for ‘freehold’ properties. In Dubai, foreign ownership is permitted in areas designated as freehold. Foreigners who don’t live in the UAE and expatriate residents may acquire freehold ownership rights over property without restriction, usufruct rights, or leasehold rights for up to 99 years.
Dubai offers promising and lucrative opportunities when it comes to real estate investment. This boom can be traced back to the Freehold Law of 2002. Revolutionizing property ownership rules, the legislation allowed non-UAE citizens to engage freely in buying, selling, leasing and renting properties.
The city’s appeal is also growing as an investment destination due to its strategic geographical location, ambitious infrastructural projects, world-class amenities and reputation as a tax haven, attracting real estate investors locally and globally. With the continuous influx of expatriates and tourists, there’s a steady demand for both residential and commercial properties.
Dubai’s prime property market saw an impressive 24 transactions exceeding $8.2 million in November 2024, according to the latest report from ValuStrat. This surge in high-value sales highlights the continued demand for luxury real estate in the city.
Dubai’s real estate market also witnessed a 20.8 percent surge in average annual rent prices, reaching $24,581.74 in November, according to Springfield Properties. This makes the city one of the markets with the highest return on investment when it comes to real estate. Dubai offers gross investment yields of 7 percent, nearly double New York’s yield of 4.2 percent and almost triple London’s modest 2.4 percent.
Short-term rentals gain traction
This year, short-term rentals ranked within the top 25 most searched terms, reflecting a growing interest in more flexible living options. This trend was evident in both Dubai and Abu Dhabi. Dubai saw over 22,000 searches for short-term rentals, while Abu Dhabi recorded 5,400 searches, underlining the growing trend for shorter-term stays across the different emirates.
Short-term rentals in Dubai are reshaping the rental market, with a 30 percent increase in demand compared to this time last year. Industry experts claim that the trend is revolutionizing the region’s real estate scene, offering remarkable returns for savvy property owners, and attractive accommodation options to visitors.
“Over the past year, we have seen short-term rentals in Dubai surge, with a 30 percent increase in bookings due to rising tourism and a demand for flexible living options,” explained Myles Rothwell, managing director at Edwards and Towers.
Property Finder’s “Opening Doors: Insights, Trends and Forecasts for Real Estate” report reveals that most short-term renters with families, for example, prefer lifestyle-oriented communities with vibrant assets and good connectivity. While consumers seek unique experiences curated by diverse hosts. For investors, this is an opportunity to select properties that promise the best returns.
Most popular areas for short-term rentals
In recent years, Dubai has become a luxury travel destination, with visitors willing to pay more for high-end accommodations. A significant trend that emerged among families and groups is the rising preference for larger holiday homes over multiple hotel rooms, driving up the demand for vacation villas and spacious apartments for short-term rentals.
Beyond the increase in demand, there are specific areas that are becoming more well-known for the short-term rental options they offer. Anthony Joseph Abou Jaoude, founder and CEO of Primestay, one of the leading holiday home rental companies in Dubai, highlights the most popular areas for short-term rentals including:
- Business Bay
- Arjan
- Jumeirah Village Circle
- Downtown Dubai
- Palm Jumeirah
- DAMAC Hills
These vibrant locales offer a rich blend of world-class amenities and trendy communities, providing unique experiences and effortless access to the city’s attractions.
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Dubai real estate market’s future outlook
Dubai recently launched the Dubai Real Estate Sector Strategy 2033 which presents a targeted plan designed to enhance the sector’s economic influence within the emirate. This involves a significant increase in transaction volumes and reinforces Dubai’s status as a leading destination for international investors.
The strategy aims to achieve its ambitious goals through a set of key performance indicators. These include doubling the real estate sector’s contribution to Dubai’s GDP to approximately AED73 billion, increasing homeownership rates to 33 percent, boosting real estate transactions by 70 percent, elevating the market value to AED1 trillion, and expanding the value of Dubai’s real estate portfolios twentyfold to AED20 billion.
Reflecting its robust strength and resilience, Dubai’s total number of real estate transactions reached 188,000 as of November 2024, with a combined value of $170.2 billion, representing a 38 percent increase in transaction volume and a 23 percent rise in value compared to 2023. Notably, property sales surpassed AED437 billion for the first time, marking a 33 percent growth compared to the same period last year.
While 2023’s launches were largely in the luxury and ultra-luxury segments, 2024 has brought projects across a wider spectrum of price ranges, highlighting the growing diversity of the UAE and Dubai’s real estate market. With over 250 additional projects in the planning phases, Property Monitor anticipates that new launches will maintain historically high levels throughout the remainder of 2024 and well into 2025.
