Dubai’s property market has reached unprecedented heights as prices surged to an all-time high in November, surpassing the previous peak recorded in September 2014.

According to the latest data from Property Monitor, property prices rose by 1.17 percent to a record-breaking Dh1,271 per square foot, marking a three percent increase over the 2014 high.

The surge in property prices, initially driven by the recovery in villas and townhouses, has now seen the apartment segment taking the lead in the growth phase due to heightened demand.

This comes as Property Monitor reports a more moderate pace of price increases last month, attributing the steady uptrend to the continuous influx of foreign residents and investors in the post-Covid-19 era.

The shortage of residential units, initially observed in the luxury segment, has now expanded to impact the affordable housing market.

As reported earlier in the week by Khaleej Times, Dubai’s population growth has outpaced the supply of residential properties in 2023.

The Dubai Statistics Centre reveals that the city welcomed 100,000 new residents this year, while only 50,000 new properties were delivered in the previous year.

Consequently, the emirate requires a 50 percent annual increase in new properties to meet the rising demand.

Zhann Jochinke, the Director of Market Intelligence and Research at Cavendish Maxwell, notes the trajectory of the property market since October 2020.

Prices have surged by an average of 44.9 percent, with apartments catching up in the third quarter of 2022 after a period of lagging behind villas and townhouses.

While the latter property types experienced muted growth, apartments have shown stronger gains.

Despite reaching an all-time high, property prices in Dubai remain comparatively affordable when compared to major global cities such as Hong Kong, London, Paris, and New York.

Property Monitor records a significant uptick in sales transactions, with 122,657 transactions recorded in the first 11 months of the year, representing a 40.3 percent increase over the same period in the previous year.

The firm now anticipates exceeding its initial expectations of 120,000 to 125,000 sales by the end of the year, projecting over 130,000 sales.

Industry executives foresee continued growth in property prices in 2024, albeit at a more steady and slower pace.

The inability of supply to meet demand is expected to be a contributing factor. Lewis Allsopp, CEO of Allsopp & Allsopp Group, predicts that Dubai will likely set new records well into 2024, provided there are no unforeseen natural disasters or events.

Contrary to declining, Dubai is expected to thrive in the coming year.

Last Updated: 20 December 2023