Month: April 2024

With the official announcement from the Dubai Land Department and the Real Estate Regulatory Agency (RERA), a new rental price revaluation procedure is set to commence within the UAE real estate rental market from the 1st of April, 2024. This new system, designed to enhance market stability, has been meticulously developed for the benefit of all stakeholders.

Based on the latest data (for the period between January and March 2024), the rental market in Dubai experienced 72,885 lease agreements that were renewed, involving 145,770 landlords and tenants. The number of renewed lease agreements decreased by 7.2% compared to the first quarter of 2023.

Under the new regulation, landlords are now required to provide a court decision or order to increase rental prices (previously, the landlord was just required to pay the fee to the Dubai Land Department).

The government strongly recommends the use of the RERA Price Index Calculator, updated in March 2024. This tool, designed to ensure fair rent increases in line with the average market rental rates, provides tenants with a sense of security and landlords with a clear guide for rent adjustments.

The new regulation signals a more stable and transparent market, creating an environment that is attractive and promising for potential investors.

Sourced from:

1. https://web.archive.org/web/20090430035914/http://rpdubai.ae/rpdubai/welcome
2. https://dubailand.gov.ae/en/rera/#/

The construction of the project V1TER Residente is ongoing in accordance with the agreed plan.

As of today, the following progress has been made:

• under-ground (sub-structural) works 
• piling and shoring has been completed 100% 
• excavation works has been completed 100% 
• pile caps works 50% completed 

Completion of construction: 3rd quarter of 2025

The 1WOOD project has ongoing construction processes. 7% of the overall work assigned for this project  is successfully completed, including the major tasks:

• Sub-Structural works (underground works) 
• Pile works has been completed (total piles 100) 
• deep foundations (piling and shoring) works has been completed 
• excavations works: under progress 30% has been completed 
• Dewatering works under progress 
• Piles head breaking works has been started 

Completion of construction: 3rd quarter of 2025

Construction of RA1N is successfully progressing in accordance with the initial plan. So far, we have carried out the following tasks:

• Super-structural Works (level 16th)
• Block Works (level 9)
• Plaster Works (level 7)
• Electromechanical Works (level 6)
• Painting Works (level 5)
• Building envelop Works (level 8)

Сonstruction is going on in accordance with the schedule of construction works.

Construction of OZONE1 is progressing in accordance with the plan. So far, we have carried out the following tasks:

• 15 piles driven out of 137

Completion of construction: Q2 2026

The UAE has operated according to the principles of FATF, providing the sense of security and prestige to the investors as these are the principles of the European community.  In March 2024, the UAE was removed from the FATF “Greylist.” This list was developed by the Financial Action Task Force to fight against money laundering. 

According to Allsopp & Allsopp (2024), for the UAE, exiting the FATF “green list” offers benefits to its economy and enhances its global position, attracting more foreign investment and establishing trustworthy relationships with international partners. The real estate sector, specifically, is expected to experience substantial advantages from this alteration.

As we look into the data for the first quarter, Allsopp & Allsopp company  has identified several key trends that are shaping the UAE’s real estate market:

1. Sharp Increase in Sales. Since the beginning of 2024, sales volume increased by 19.3% compared to the first quarter of 2023. Sales from January through March also broke records seen in the fourth quarter of 2023.
2. Buyer Preferences. This year, there is a preference for financing over cash purchases and off-plan sales in the market.
3. In terms of numbers:
   • 30% of all sold properties were priced below 1 million dirhams,
   • 80% of sales occurred at prices below 3 million dirhams.
   • As rental rates rise and interest rates become more affordable, people prefer buying property rather than renting.
4. Off-Plan Property Sales. Off-plan real estate continues to gain momentum in sales; developers are launching new projects at an impressive frequency—once every 17 hours, significantly more than in the previous quarter, which was once every 36 hours.
5. The leaders among the regions are still:
   • Jumeirah Village Circle,
   • Dubai Marina,
   • Business Bay.

Apartments accounted for 61.2% of the total sales volume by value, while villas and townhouses made up 38.8%.
Sourced from: https://www.allsoppandallsopp.com/dubai/about-us/news-videos/1311-Is-Dubai%E2%80%99s-property-market-set-to-soar-amidst-UAE-coming-off-the-FATF-Greylist%3F-

For over a decade, the UAE has been at the forefront of pioneering new systems in finance and investment.

Once again, the Emirates has set the stage for a global trend in the investment sector. Investors worldwide are increasingly directing their capital towards the development of new technologies, renewable energy sources, and the tourism sector, a trend that presents exciting opportunities for all.

UAE is currently being focused on developing the following areas Among the innovations and technologies: 

• Artificial intelligence;
• Fintech;
• Blockchain;
• Innovative and sustainable construction;
• The tourism and hospitality sector.

At the heart of the UAE’s agenda is a resolute commitment to become a global technological hub. 

The government’s initiative is not just a mere interest, but a strategic commitment towards developing and supporting new technologies in accordance with Dubai’s economic program, D33 (https://u.ae/en/about-the-uae/strategies-initiatives-and-awards/strategies-plans-and-visions/finance-and-economy/dubai-economic-agenda-d33), which outlines a comprehensive roadmap for the city’s economic growth and diversification.

This program encompasses a significant project consisting of 100 sub-projects, launched to accelerate economic growth and reinforce Dubai’s role as a global hub for logistics, tourism, and innovation. According to the plan, by 2033, Dubai aims to rank among the world’s top three most economically developed cities.

The primary goal is to increase the country’s capital. But how? 

1. Foreign trade in goods and services up to $7 trillion;
2. Direct foreign investments up to $177 billion;
3. Government expenditures up to $191 billion;
4. Private sector investments up to $272 billion;
5. The value of domestic demand for goods and services to be up to $817 billion.

Additionally, the aim is to gain $27 billion annually from digital transformation projects in Dubai’s economy.

The UAE is becoming a hub for attracting startups worldwide thanks to strong government support for entrepreneurship, facilitated by various programs and investments (for example, aimed at supporting local SMEs).

“Less traditional resources, more economy based on knowledge, technology, and innovation.”

Today, the UAE is increasingly focusing on the development of the construction sector with the inclusion of modern and innovative technologies. For example, Dubai has already issued the first permit for the construction of buildings using 3D printing technology within the Emirates (the permit was granted to the construction company “Nakheel” for a project in the Al Furjan Hills area).

The construction using this method took only 20 days, an extraordinary result representing a significant shift in the country’s urban planning. By 2030, Dubai plans to implement this technology in at least 25% of construction projects.

Sourced from: CNN: https://edition.cnn.com/style/article/dubai-3d-printed-buildings-intl/index.html

Record Levels of Foreign Direct Investment (FDI)

In 2023, the United Arab Emirates achieved a record level of FDI, amounting to $22.73 billion, a 10% increase compared to the previous year. This underscores their growing appeal as a dynamic economic hub attracting international investments (Economy Middle East)​.

Leading Positions in Green Projects

The UAE ranks second globally in the number of greenfield projects, with 1,280 projects in 2024, a 36% increase from the previous year. This highlights the active development of the country and its attractiveness to foreign investors in such sectors as renewable energy, healthcare, and technology (Emirates NBD Research)​.

Sectoral Growth and Investment Incentives

The UAE continues to attract investments into new economic sectors, such as fintech, e-commerce, agritech, healthcare, education, tourism, the space industry and much more. The government offers a range of incentives for attracting FDI, including simplified licensing procedures and the possibility for foreigners to fully own companies within specific industries (UAE Government Portal)​.

Geopolitical Stability and Economic Reforms

The stability and dynamic development of the UAE are reinforced by long-term political stability, a high-quality business environment, and a strategic geographical position that makes the country a significant player in the Persian Gulf region, Iran, Asia, and the Middle East (Lloyds Bank Trade)​.

These aspects underscore the significance of the UAE on the global economic stage and its ability to attract international investments. As a result, it contributes to the strengthening and further development of the UAE economy across various vital sectors.

Dubai’s population has surged by 25,000 people, reaching a total of 3,680,785 as of April 4, 2024. This rapid inflow of residents and specialists from overseas is a significant shift compared to last year’s period, reshaping the city’s rental market.

The population boom in Dubai has triggered a substantial rise in rental demand. In the first quarter of 2024 alone, the Dubai rental market witnessed a whopping 72,885 lease renewals, involving a total of 145,770 landlords and tenants. This represents a remarkable 15% increase in the number of contracts compared to the previous year, signalling a thriving rental market.

Diving into the details, apartments comprise 80% of the leased properties, while the remaining 20% are villas and townhouses. This mix reflects the diverse needs and lifestyles of Dubai’s growing population.

The local government has established a comprehensive legislative framework to oversee and regulate the rental market, ensuring that both landlords and tenants enjoy substantial legal protection under UAE law. The Dubai Land Department, through its RERA division, oversees all aspects of the rental sphere, requiring that all long-term lease agreements (those extending beyond a year) be registered in the unified electronic system known as EJARI.

EJARI offers several benefits:

• It helps monitor and curb unjustified rent hikes,
• It safeguards tenants’ rights against illegal evictions,
• It ensures that a property cannot be leased out simultaneously to different tenants for the same period.

As Dubai continues to welcome new residents, its rental market is not just keeping pace but thriving!

Sourced from: 

Abbas, W. https://www.khaleejtimes.com/uae/dubais-population-grows-by-over-25700-in-first-three-months-of-2024 

DXB Interact

Gulf News

https://gulfnews.com/business/property/from-april-1-dubai-landlords-can-seek-rent-re-valuation-only-with-a-legal-order-1.1712127889916