Markaz: The real estate sector in the UAE will witness rapid growth during the second half of 2022

Real estate prices in the UAE continue their upward momentum in 2022. Archive

In its series of reports on the "Real Estate Sector Outlook for 2022" in the Kingdom of Saudi Arabia and the United Arab Emirates, the Kuwait Financial Center "Markaz" announced its expectations that the real estate sector in the two countries will witness rapid growth during the second half of 2022, supported by their solid economic base.

The report included an analysis of the performance of the sub-sectors;

Such as the residential, office, retail and hospitality sectors during the first six months of the year, and the impact of various new social and economic policies, reforms and initiatives on this sector.

The report, prepared by Marmore MENA Intelligence "Marmore", the research arm of the center based on the "complete real estate index of the center", aims to help investors determine the current state of the real estate market in the GCC region by studying a number of economic indicators. ;

The most prominent of which are: oil and non-oil GDP growth, inflation, creating new job opportunities, interest rates, population growth, and other indicators.

The results and observations contained in the reports were supported by data from the past seven years, in addition to providing forecasts for the remainder of this year, as well as for the coming year.

real estate sector

The report, "The future outlook of the real estate sector in the United Arab Emirates for the second half of 2022", indicates that the real estate sector in the UAE is generally witnessing a rise in 2022, and an increase in the value of rents and real estate prices.

The report also indicates that the volume of transactions in the first quarter of 2022 in Dubai reached its highest total, compared to the same period in previous years, at the level of the countries in the region.

Among the main factors that boosted the growth rate in the real estate sector in the UAE, the upward momentum in the national economy was supported by the rise in oil prices, the growth of the non-oil sector, and the positive results of Expo 2020 Dubai.

real estate prices

Real estate prices in the UAE will continue their upward momentum in 2022, with average residential real estate prices in Dubai and Abu Dhabi increasing by 11.3% and 1.5%, respectively, during the 12 months until March 2022.

Rents for Class A office properties in the two cities continued to rise, posting an increase of 9% and 5%, respectively, on an annual basis.

In the retail sector, Dubai witnessed an average rent growth of 10.5% in the first quarter of 2022, while Abu Dhabi witnessed a decline in average rents by 7.8% in the same period.

The sector's performance remains positive in light of the increasing demand from new residents locally and from international brands.

The hospitality market also witnessed significant growth across all key indicators including occupancy rates, average daily rate and revenue per available room in the first quarter.

This rapid growth may slow down in the short term against the backdrop of global events, but it is expected to continue the growth trajectory in the long term.

Incentives for investors

Based on the assessment of various macroeconomic factors, Markaz expects that the pace of growth in the real estate sector in the UAE will accelerate during the second half of 2022. It is also expected that the UAE will motivate investors looking for a steady flow of income to enter the real estate market, especially in light of The availability of relatively high rental returns coupled with the ability of tenants to afford these rents, in addition to the incentive policies regarding visas and new work permits aimed at enabling skilled workers to settle in the UAE, and sustainable urban development plans under the Dubai Urban Master Plan 2040, in When the state works to further enhance investor confidence through measures aimed at enhancing transparency and reporting in the real estate sector, and restructuring government agencies to increase efficiency and develop the investor experience.

Transaction volume in the first quarter of 2022 in Dubai reached its highest total, compared to the same period in previous years ever.

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