Dubai leads global prime residential rental values in the first half of 2024: Savills.
According to the latest Savills Residential World Cities Index, Dubai ranked first among 30 global cities in rental value growth during the first half of 2024. It also showed that the emirate placed fifth in the world for capital value growth during the same period. Dubai topped the rental value index with a 12.1% increase in H1 2024, followed by Bangkok (9%) and Lisbon (7.5%). “These markets feature a very strong lifestyle element, and corporate relocations also support demand in these cities,” says Savills research.
Savills noted that prime rental values in Dubai, which scored high in the index, have been on the rise for several years, as a range of business-friendly government initiatives and attractive residency visa programs are drawing people from across the globe to set up base in the emirate.
Andrew Cummings, Head of Residential at Savills Middle East, said Dubai’s residential market continued its extraordinary run in the first six months of the year, logging record transaction volumes and values. “We are seeing some of the best brands and developers launching prime projects in Dubai and the wider UAE region to capitalize on growing demand,” he said.
Cummings also stated that, given the limited existing supply, there are no signs of a near-term cooling in prime rental rates.
Dubai and Lisbon are leading prime rental growth
Kelcie Sellers, Associate Director at Savills World Research, noted that Dubai and Lisbon have long been leaders in prime rental market growth due to excessive demand for high-quality rental properties, while Bangkok is a newcomer. According to the report, on many EMEA markets, demand continues to outstrip the supply of prime rental properties, driving prime rental price increases throughout the region. She added that none of the EMEA markets tracked by the index saw rental price declines from December 2023 to June 2024.
Amid higher interest rates, rental growth continued to outpace capital values, rising by 2.2% in the first half of the year, with 25 of the 30 analyzed markets showing stable or positive rental growth, Savills said. Rents also tend to offer international tenants the flexibility they desire when entering a new market, further contributing to these increases, according to the firm.
Prime residential properties remain resilient
The report states that prime homes in global city locations stayed robust in H1 2024, recording an average capital value growth of 0.8%, surpassing the 0.6% rise predicted for the whole of 2024.
However, the report indicates broader caution among buyers, who are waiting for clarity on interest rates.
“In terms of price per square meter, Dubai still offers immense value for investors and end-users seeking high-quality, luxury homes with attractive amenities,” said Cummings. “Combined with the lifestyle and connectivity the emirate provides, Dubai remains one of the most sought-after residential destinations in the world,” he added.
According to Savills, across the EMEA region only two of the 13 markets saw negative capital value growth in H1: Berlin and London recorded slight price declines of -0.8% and -0.1% respectively.
Source: Arabian Business
