Dubai achieved an average growth of 3.2 percent year-on-year to June this year, despite the increasing regional geo-political unrest

Despite growing regional geopolitical upheaval, Dubai is continuing to consolidate its position as a global economic powerhouse in 2023, with average annual growth of 3.2% up to June of this year. This defies global economic trends. By GDP, the industries that do the best are transportation and warehousing (10.5%), lodging and food services (9.2%), and logistics and warehousing (10.5%). Not surprisingly, given the flood of investors and new inhabitants drawn to Dubai by its business-friendly regulatory environment and lifestyle offerings, the real estate industry in Dubai also saw significant GDP growth over the same period, clocking up 3.6%.

Villas in Jumeirah Islands saw the biggest yearly rise by area, at 20.8%, closely followed by those in Emirates Hills (19.6%) and Palm Jumeirah (17.9%). These neighbourhoods are home to some of the priciest residences in Dubai, which amply demonstrates the rising demand from extremely rich purchasers who are relocating to Dubai. More than 57,000 real estate transactions took place in Dubai in the first half of 2023, representing a 44% increase over the previous year. Ready house sales accounted for 47% of the volume, the largest demand for ready homes to date as new residents seek for rapid housing.

In the second quarter of this year, Dubai also saw record off-plan sales of $9.3 billion, accounting for 58.7% of the total versus secondary market properties. This represents a significant change from prior years when ready houses predominated in sales. Although September 2023 saw a decline in off-plan sales volumes, perhaps as a result of people returning from vacation and readjusting to the regular schedule of work and school, ready-house sales saw a sharp spike in demand on the secondary market. Overall, record sales of plots, villas, and flats totaled $2.23 billion in the one week ending October 20, demonstrating unequivocally that demand is still high. 

Mid-market buyers want ready-to-move-in or off-plan properties that combine luxury, conveniences and affordability with the building's community features, as opposed to more costly villas and townhouses. Competitively priced residential off-plan and ready apartments account for most sales volumes in Dubai's mid-market, which is by far the most in-demand category.

Due to its affordability and high quality, Dubai is drawing more and more people and small company owners. However, the mid-market is catching up, and homeowners will continue to observe this growing trend until 2024. The initial value gain started in the luxury class last year.