The cost of apartments in Dubai increased by 1.5% during the month of September.

New data released on Monday indicates that Dubai's real estate market experienced remarkable growth in September as investors continued to pour in. According to Valustrat's statistics, the apartment segment saw a monthly capital gain of 1.6% and an unprecedented annual growth of 11% in September, marking the highest capital growth for apartments in a decade. The ValuStrat Price Index (VPI) for September 2023 surged by 2.1% monthly and 15.1% annually, reaching 96.6 points, with reference to the benchmark of 100 points established in January 2014, apartments scored 79.7 and villas 123.6.

The VPI, a valuation-based price index, was designed to reflect the recurrent changes in capital and rental values of typical residential and commercial properties.

Capital gains in the housing market, including apartments, typically gain momentum in September. Even more affordable housing in the mid-range segment saw increased valuation. The report also highlighted a decrease in off-plan transactions and a robust rise in the market for ready (secondary) homes.

Among apartment submarkets, The Greens (17.8%), Discovery Gardens (17.1%), Motor City (15.2%), and Jumeirah Beach Residence (11.6%) demonstrated the strongest annual performance. Palm Jumeirah (20%) came in second place. On average, apartment prices remained 29.2% below the market peaks of mid-2014.

Villa prices, in comparison to August, increased by 2.6%, and there was a 19.8% year-over-year increase. Jumeirah Islands (26.3%), Dubai Hills Estate (24.4%), Palm Jumeirah (24.2%), and Emirates Hills (21.8%) showcased the most significant annual returns for villas. All villas and townhouses monitored by the VPI had exceeded their 2014 price peaks, except for Al Furjan and Jumeirah Village Triangle.

However, both monthly and yearly home sales experienced declines of 29.7% and 10%, respectively. Off-plan Oqood (contract) registrations dropped by 55.7% on a monthly basis and 37.5% annually, comprising 40% of total monthly sales. In contrast, transactions for ready homes increased by 14.5% monthly and 24.4% yearly.

In September 2023, 25 ready residences priced at over Dh30 million were sold, primarily in locations such as Palm Jumeirah, Emirates Hills, Jumeirah Bay, Al Barari, Dubai Marina, and Dubai Hills Estate. Leading the sales statistics last month were properties by Emaar (17.2%), Damac (13.1%), Nakheel (8.1%), and Dubai Properties (4.3%).

The most sought-after off-plan transactions during the month were related to projects in Arjan (13.9%), Jumeirah Village (13.7%), Business Bay (8.9%), and Damac Lagoons (8.8%). Meanwhile, the majority of ready residences were sold in Business Bay (5.3%), Downtown Dubai (6.4%), Emaar South (5.7%), and Jumeirah Village (10.4%). Mudon achieved a record in September with the highest number of off-plan properties traded in a single month.

Dubai's continued appeal to investors is attributed to its stability, transparency, and long-term property-linked visa options, making it a safe haven for investors amid global uncertainty. Analysts anticipate that this trend will likely persist.