The Contribution of the Real Estate Sector to Economic Growth
Over the past years, the real estate sector has played a significant role in driving the comprehensive economic development witnessed by the Emirate of Dubai. It has actively contributed to the formation of Dubai’s national income, with the sector’s contribution to GDP growth exceeding 14% in some years.
During the first half of 2020, the contribution of the real estate sector to Dubai’s GDP increased to 8.2%, compared to 7.4% in 2019. Despite this increase, the overall decline in GDP growth was accompanied by a 3.5% decrease in the growth rate of the real estate sector.
Regarding the construction sector, its contribution to Dubai’s GDP reached 7.3% during the first half of 2020, compared to 6.3% in 2019. However, the construction sector was also affected by the general decline in GDP growth during the first half of 2020 due to the pandemic, with the sector recording a growth rate of -2.1% during this period.
Real Estate Transactions
The real estate sector in the Emirate of Dubai recorded 50,909 real estate transactions during the year 2020. Despite the exceptional global economic circumstances that affected most countries worldwide, and despite the slight decrease in the number of real estate transactions in 2020 compared to 2019, the sector’s annual performance — particularly during the final months of 2020 — demonstrated exceptional indicators that confirm the strength and resilience of Dubai’s real estate sector.
When looking at the number of real estate transactions on a quarterly basis during 2020, the results clearly indicate a rapid recovery achieved by the real estate sector in Dubai during the third and fourth quarters of 2020. This recovery supported the V-shaped recovery scenario that was predicted in the second quarter of 2020 and highlighted by related studies.
In the third quarter of 2020 alone, the real estate sector recorded 13,171 real estate transactions, achieving a growth rate of 70% compared to the second quarter of 2020, which witnessed the peak of the sector’s decline during that year.
