Realiste, a company located in Dubai, examines real estate values and rental yields in the fourth quarter using artificial intelligence and a wealth of data.
A research predicting the real estate market trends for the fourth quarter of 2023 was produced by Realiste, an artificial intelligence platform located in Dubai that ranks investment prospects in the real estate investment sector using sophisticated algorithms.
Based on variables including expected return on investment, growth projections, infrastructure patterns, and future market dynamics, the analysis projects price increases for real estate in five of the busiest real estate markets, from Bukadra Part 2 to Al Kheeran, popularly known as Dubai Festival City. Learn more about related developments in Dubai’s rental conflicts now heard in the Metaverse.
Considered Factors
The software combines over 200 criteria for specific cities and leverages a large quantity of input data from numerous sources.
It generates estimates for every apartment type, building quality level, and district by taking into account variables like seasonality, news events, and pricing constraints.
In addition to average annual rental yield and price growth projections, it provides information on the following indicators: Class of Buildings (average building quality in the neighborhood), Development Level (percentage of land occupied by buildings, green spaces, or water), Access to Parks (percentage of surface area in contact with water), and Access to Water (percentage of surface area that is in contact with water).
Dubai’s Principal Regions of Anticipated Price Growth
Sobha Hartland (8.05 percent), Dubai Harbour (6.18 percent), Al Warsan First (6.99 percent), Al Kheeran (5.58 percent), and Bukadra Part 2 (8.12 percent) are the five regions with the biggest predicted increases in average price per square meter in the upcoming quarter.
Bukadra Part 2 is expected to have the most increase in housing prices. Buildings as a class are rated 92.6 percent, while development level is 37.6 percent. Three-bedroom apartments in the neighborhood have the lowest average price per square meter, at AED22,497, and are predicted to increase to AED26,941.
With a reasonably high class of buildings at 88 percent, Sobha Hartland has 9.8 percent access to water and 10.8 percent access to parks. For studios and one-bedroom apartments, the area’s annual rental yield will increase by 6% and 5.4 percent, respectively.
A significant increase in transactions in the residential real estate market was also mentioned in the report. In the third quarter of 2023, there were 45,968 transactions overall, which is a 72% increase over the 26,747 transactions recorded during the same time in the previous year.
Marsa Dubai, Al Merkadh, and Al Barsha South Fourth were the top regions where investors expressed interest in purchasing new real estate, with 3,752, 3,373, and 3,084 transactions, respectively.
52 percent of all transactions were made in the top ten areas out of a total of 120.
AED114,271 million ($31,115 million) was the total amount of transactions in Q3 2023; the average transaction value was AED2.488 million ($680,000).
In contrast, the reported figures from the previous year were AED 2.189 million and AED 58,488 million, respectively, showing a year-over-year rise of 14 percent and 95%, respectively.
Real Estate Rentals in large Areas are Declining
The top 10 districts saw reduced rental agreements in Q3 of 2023 compared to the same period the previous year; this could be related to occupation levels.
The 123,123 rental agreements were evenly split among the different districts. Only 30.5 percent of the entire volume was represented by the top 10 locations in terms of the quantity of agreements. Nonetheless, this quarter’s number of agreements decreased in each of these categories.
Even though Jabal Ali Industrial First had the most new rental contracts (5,571), it was still over 5% fewer than 5,283. Business Bay, which increased by just 1%, and Wadi Al Safa 5, which increased by 17%, were the only two locations in the top 10 to exhibit a slight gain.
A self-learning algorithm called Realiste AI was created to evaluate the global investment appeal of real estate. It assesses rental revenue, unit values, and possible increases in real estate and rental values. Explainable, the algorithm is continuously updating its model with new market data and customer feedback.
