Dubai tops global rental growth in 2024

Dubai has topped the rankings for rental value growth among 30 global cities in the first half of 2024, according to Savills' latest Residential World Cities Index.

The emirate also ranked 5th globally for capital value growth during the same period. Dubai's rental values surged by 12.1 percent, outperforming Bangkok (9 percent) and Lisbon (7.5 percent).

Savills research highlighted that these markets, including Dubai, attract strong demand due to their appealing lifestyle options and the influx of corporate relocations.

Dubai's prime real estate rents have been rising steadily, driven by favorable government policies and attractive residence visa programs, which have drawn people worldwide to establish a base in the city.

Andrew Cummings, Head of Residential Agency at Savills Middle East, noted that Dubai's residential market continued to thrive in the first half of the year, with record-breaking transaction volumes and values.

He added that the launch of world-class projects by top brands and developers is capitalizing on the growing demand, and with limited supply, prime rentals are expected to remain high.

Kelcie Sellers, Associate Director at Savills World Research, emphasized that Dubai and Lisbon have consistently led the prime rental market growth due to high demand for quality rental properties, while Bangkok is a newer contender.

The report noted that demand for prime rentals continues to exceed supply in many EMEA markets, supporting rental price growth across the region.

None of the EMEA markets tracked in the index saw rental prices decline from December 2023 to June 2024. In a high-interest-rate environment, rents outperformed capital values, growing by 2.2 percent in the first half of the year, with 25 of the 30 markets analyzed reporting stable or positive rental growth.

Renting also offers international tenants the flexibility needed when entering a new market, contributing to these increases.

The report further indicated that prime residential properties in major world cities remained resilient in the first half of 2024, with an average capital value growth of 0.8 percent, surpassing the predicted 0.6 percent growth for the year.

However, buyers remain cautious, awaiting clarity on interest rates. On a per-square-foot basis, Dubai continues to offer significant value to investors and end-users seeking luxurious homes with attractive amenities.

Cummings highlighted that Dubai's lifestyle and connectivity make it one of the world's most desirable places to live.

According to Savills, only two of the 13 markets in the EMEA region experienced negative capital value growth in the first half of the year, with Berlin and London seeing slight declines of -0.8 percent and -0.1 percent, respectively.