Dubai’s real estate market offered rental yields of up to 11 percent in some areas, significantly outperforming global market averages during the first half of 2024, a new report finds.
This remarkable return on investment (ROI) comes amid a broader trend of rising property prices and increased demand in the emirate, as revealed in the latest H1 2024 market report by Bayut.
The report highlights Dubai’s position as a prime investment destination, where robust yields are coupled with continued market growth, defying speculations of a slowdown in the emirate’s real estate sector.
Dubai real estate investment hotspots
Leading the pack in terms of ROI were affordable apartments in areas such as Dubai Investments Park (DIP), Discovery Gardens, and Remraam. These locations offered projected rental yields of up to 11 percent during H1, making them highly attractive to investors seeking strong returns in the current global economic climate, the Bayut report found.
For those looking at mid-range properties, areas like Dubai Sports City, Dubai Silicon Oasis, and Motor City were proven to be particularly appealing. These locations boast rental yields surpassing 9 percent for apartments, offering a balance between affordability and strong returns.
Even in the luxury market, Dubai continues to impress with its investment potential. Apartment locations such as Green Community, Al Sufouh, and DAMAC Hills have shown impressive returns of up to 9 percent, outpacing many global markets in the high-end property sector.
The villa segment also presented lucrative opportunities for investors. Affordable villa communities like International City offer average ROIs exceeding 7 percent. In the mid-tier segment, areas such as Jumeirah Village Triangle, Jumeirah Village Circle, and Mudon promise projected ROIs ranging from 6 to 8 percent. Luxury villa communities aren’t far behind, with The Sustainable City standing out at an ROI exceeding 7 percent, thanks to unique property features and limited market supply, Bayut said.
The attractive yields come against a backdrop of overall market growth. The first half of 2024 saw more than 43,000 property sale transactions in Dubai, amounting to nearly AED123 billion.
Dubai property prices increase
Price trends across different segments further underscore the market’s robustness:
- Affordable properties: Villas in some areas have seen price increases of up to 41 percent, while apartment prices have shown more variability.
- Mid-tier properties: Average sales transaction prices for apartments increased between 12 percent and 40 percent, with villas seeing rises of 4 percent to 23 percent.
- Luxury properties: Most areas recorded increases in transactional prices ranging from 5 percent to 24 percent.
“Amidst the global economic slowdown and rising interest rates, we have noticed a pattern of investors worldwide turning to wealth-preserving assets. Dubai’s real estate sector has emerged as a standout choice in today’s economic climate, with prices and consumer interest continuing to rise even after a 24-month period of continuous growth,” said Haider Ali Khan, CEO of Bayut and Head of Dubizzle Group MENA.
Bayut also highlighted the importance of data-backed transparency in the real estate industry, mentioning the introduction of innovative products like TruEstimate, a new tool developed in collaboration with the Dubai Land Department (DLD) to provide precise property valuations.
Source: Arabian Business
