Dubai's residential real estate market saw significant expansion in the second quarter of 2024, achieving an unprecedented 35,310 transactions, representing a 20.5% increase compared to the previous year.

This growth was fuelled by the increasing demand for customisable units and consistent investment returns.

The findings by UAE real estate firm Primo Capital found that the growth was driven by a 23.9% increase in off-plan property sales and a 15.2% rise in secondary market transactions. This trend indicates the sustained confidence of prospective buyers and strong demand within the industry, Economy Middle East reports

“The shift by leading developers in the UAE from one rigid design to a customer-centric construction has boosted activity,” said Mohammad Zeaiter, senior property advisor at Primo Capital. “Giving buyers the freedom to choose, change and customise according to their tastes and preferences is a major reason for the growth.”

Furthermore, Dubai’s real estate market is still attracting international investors as it “guarantees steady ROI (return on investment) and higher capital gain” compared to other metropolitan cities, Zeaiter added. 

The report also showed positive growth in Abu Dhabi’s residential sector, where villa prices rose by 2.3% and apartment prices by 4.3% year-on-year. 

In addition, Dubai’s commercial real estate market saw average rents increasing by 22.2% annually and 17.1% quarterly, driven by the expanding needs of companies within the flourishing UAE economy.

The industrial and logistics sector also experienced annual rental rate increases of up to 14.3%, fuelled by increased demand for warehouses and storage facilities. The hospitality sector also maintained strong performance, with a 0.9 percentage point annual increase in average occupancy rates.

Retail rental rates in Abu Dhabi and Dubai saw average increases of a respective 14.7% and 10.5% over the year leading up to Q1, reflecting a supply-demand mismatch and increased commercial activity.