Dubai’s Thriving Off-Plan Market Drives UAE Real Estate Sales to Record AED 455.7 Billion in 2023

Dubai’s robust off-plan real estate sector has powered the UAE market to reach AED 455.7 billion in sales in 2023, marking the fourth consecutive year of significant growth. As demand continues to surpass supply, experts anticipate that the off-plan segment will play a crucial role in supporting market expansion in 2024 and beyond.

Madhav Dhar, COO and co-founder of Zazen Properties, noted that despite the completion of over 60,000 units, demand remains high, driven by Dubai’s rapidly growing population—one of the fastest globally. In 2023 alone, Dubai’s thriving tourism sector contributed to a property sales value of AED 160.46 billion, a remarkable 72.3% increase from the AED 93 billion recorded in 2022. Off-plan sales transactions reached 68,783, a 59.4% rise from 43,151 in 2022, setting a new record for this segment.

A recent UAE policy change allowing real estate investors to qualify for the golden visa without the AED 1 million down payment requirement has further strengthened Dubai’s real estate appeal. “This strategic move enhances accessibility for both new and existing investors, positioning Dubai as an attractive base with world-class infrastructure and connectivity,” Dhar explained. “The UAE’s commitment to innovation and growth solidifies its leadership in creating a resilient, competitive real estate sector, opening doors to new investment opportunities and sustainable development.”

Experts suggest this golden visa update will open investment access for thousands and drive the UAE’s real estate value higher. They anticipate developers will increase the pace of new projects to meet growing demand, spurred by greater investor confidence.

In Dubai, off-plan properties dominated the market in Q3 2023, accounting for 65% of total property sales value, which reached AED 13.62 billion, with off-plan transactions comprising 61% of the total volume. Analysts credit Dubai’s off-plan rebound to strong government initiatives and investor interest, with new technologies like virtual reality and blockchain enhancing market transparency and efficiency.

With rising mortgage rates impacting the affordability of ready properties, many investors are now turning to off-plan options. “Higher mortgage rates have cut into the returns on ready properties, despite increased rental yields. Off-plan investments, however, offer strategic advantages, allowing investors to lock in original prices and benefit from flexible payment plans, helping to counteract high lending rates,” analysts said. Dubai’s rapid population growth continues to be a major driver of this demand, ensuring ongoing vitality in the real estate market.