According to a recent survey, Dubai’s residential property rents increased in the third quarter of the year due to solid demand.
The real estate consultancy Core concludes that the cost of renting villas increased across the emirate by 28% year over year while renting apartments increased by 26%.
During that time, rents increased more quickly than sales prices, resulting in higher yields. Villa prices rose 16% over the previous year, outpacing the 8% increase in apartment prices. Dubai’s demand for residential rentals has increased as the city’s population grows.
The tendency will probably continue, especially in the short-term rental market. Real estate professionals claim that demand from the Russian market and winter and FIFA World Cup tourists are increasing in the short-term leasing sector alone.
Prathyusha Gurrapu, Core’s Head of Research and Advisory, stated that greater demand and faster population growth were to blame for rent increases across all income brackets.
Because of winter travel and FIFA, the short-term rental industry is also anticipated to grow in the fourth quarter, Gurrapu told Zawya.
Gross yields for villa properties increased from 5.1% to 5.6%. Likewise, apartment building owners noticed an increase in gross returns, from 6.1% to 7.1%.
Developers have increased project releases in response to the rising demand. Off-plan launch volumes for the third quarter soared 61% year over year and surpassed pre-pandemic levels by 11%.
According to Core, “The Dubai real estate market has maintained its strong pace from early 2022, with solid growth recorded across performance measures for all asset classes.”
The numerous demand drivers set in motion over the previous five years to solidify Dubai’s worldwide positioning are showing results.