Is Dubai’s property market set to soar amidst UAE coming off the FATF Greylist?

In case you missed it, last month the UAE came off the FATF Greylist, which is a list created by the Financial Action Task Force, which includes countries with identified issues in their systems to prevent money laundering and counter-terrorism financing.

Being on this list means these countries have to work on improving the regulations set in these areas. And coming off from the FATF Greylist brings real advantages for the UAE's economy and global standing.

Not only does it put us in a much better position to attract more foreign investment and build stronger relationships with international partners, but it also allows us to stand as a key financial centre in the region.

The real estate industry, in particular, is likely to see significant benefits from this change - and we’re here to break down just how with an insight into our Q1 data - powered by Allsopp & Allsopp's first-party data.

Surging sales - A signal in momentum

The Dubai real estate sector has been on an upward trajectory since the start of 2024, with sales volumes in the first quarter of the year soaring by 19.3% compared to Q1 of 2023, according to our Q1 market snapshot.

Furthermore, sales between January and March also surpassed the record-breaking volumes seen in Q4 2023, indicating a robust market that continues to gain momentum.

We also noticed trends such as affordable properties being on the rise, buyers opting for financing over cash, and the off-plan sales dominating the market.

Data diving - affordable properties are on the rise!

Our first-party Allsopp & Allsopp data found that 30% of all properties sold were priced under AED 1 million, with 80% of sales falling under the AED 3 million mark. This preference for more affordable properties is reflected in the increasing number of finance buyers versus cash buyers.

Cash is out - Finance is king!

With rents up the mark, and interest rates coming to a more affordable scale, individuals have found themselves driven towards buying properties over renting. Not to mention, foreign investment is up the charts, making the city even more financially credible for investors and international institutions. Dubai's reputation as a safe haven for investment is solidifying, attracting interest from both local and global investors.

Through this, off-plan dominance has highly taken over the market.

The off-plan market triumphs!

Through our Q1 data, we also noticed how off-plan properties continue to dominate sales, with developers launching new projects at an impressive rate of one every 17 hours, a significant increase from the previous rate of one every 36 hours.

Some key trends noticed:

• Apartment living remains popular, accounting for the highest percentage of total sales in Q1, marking a 13% increase from the previous quarter.
• Prime residential areas such as Jumeirah Village Circle, Dubai Marina, and Business Bay continue to lead in sales.
• Apartments made up 61.2% of total sales by value, while villas and townhouses contributed 38.8%.

Lewis Allsopp, our Chairman at Allsopp & Allsopp, shared his optimism about Dubai's real estate market. He said “The Dubai market performed brilliantly in Q1, with Allsopp & Allsopp seeing an incredible 26.6% surge in sales transaction volumes compared to last quarter.

“We welcomed a record number of finance buyers, surpassing cash buyers for the first time with 53% recorded as mortgage applications.

“We attribute the 41.7% increase in finance buyers to the increased rent prices coupled with softened interest rates.

“Our record-breaking ultra-luxury villa sale of AED 72 million was certainly one for the books in Q1. The breathtaking AMAIA by Mohammed Zaal was the most expensive sale in Al Barari history and accounted for part of our 41% surge in villa and townhouse sales compared to Q4.

“After being voted the most visited city in the world, it’s no surprise that over 25,700 expats made Dubai their home this quarter. It’s only a matter of time before this population growth translates to the market’s upward trajectory.

“We stand by our prediction: Dubai is on the brink of its biggest boom in 10 years.”

With Dubai recently voted the most visited city in the world and experiencing significant population growth, Lewis remains confident in the market's potential for further growth. He predicts that Dubai is on the verge of its biggest boom in 10 years, fueled by a combination of economic factors and increasing investor confidence.

Impressive, isn’t it?