The 2023 Market Preview

Christie’s International Real Estate Dubai looks ahead to what is expected to be another exceptional year for the Dubai real estate market.

The Palm Jumeirah, one of many exclusive Dubai neighbourhoods set to welcome greater investment in 2023.

A range of economic quandaries face global markets in 2023. According to a recent Barron’s report, the IMF estimates world debt today to be approximately 20% higher than in 2008. This is to say nothing of the uncertainty over how markets will respond to constant alterations to interest rates and the tightening of the purse strings. Even global real estate, particularly post-pandemic, has witnessed supply that cannot keep up with demand or prices.

Amidst this doom and gloom, Dubai real estate has held fast as a stable and upward-looking investment opportunity. This is due to a variety of factors that include prudent pandemic handling, Golden Visa reforms, a surge in HNWIs and a trademark business-friendly environment. According to a recent Arabian Business report, the city’s real estate prices soared by 50% in 2022, with 90,881 transactions — surpassing the previous 2009 record of 81,182.

Resultantly, Dubai expects to continue attracting exceptional demand and investors in 2023, albeit with more specific trends predicted to dominate the market. The post-pandemic penchant for investors to acquire private homes with spacious areas and outdoor spaces looks set to grow. Buyers have also become even more appreciative of quality, a trait reflected in the sheer amount of branded residences being launched — a clear sign of developers bolstering their luxury supply.

Importantly, the inflation that is widely predicted to afflict major economies is not expected to be a significant concern for the Dubai real estate sector, or indeed the broader Dubai economy. In fact, a recent report mentioned in Zawya has projected that average prices are expected to rise in the Emirate by a staggering 13.5%, far higher than the 5% of Miami, and 4% of Lisbon and Los Angeles.

This positive outlook is in stark contrast to luxury markets like New York, which is in the midst of a significant slowdown in sales, and Sydney, which is navigating rising interest rates. Even London, which is showing strong signs of a recovery after a tumultuous 2022, expects investors to exhibit caution until clearer signs of long-term stability do not present themselves later in the year.