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What's at Stake this week?
February 18, 2023
The future is here! We’re potentially 3 years away from riding in flying taxis in Dubai, announced earlier this week by ruler Sheikh Mohammed bin Rashid Al Maktoum, prompting a lot of excitement from residents. According to the Roads and Transport Authority (RTA), a ride in one of their flying taxis will cost almost as much as an Uber ride and can carry up to 4 passengers at once. Would you be willing to take a ride? In the meantime, let’s take a look at some other takeaways from this week 👇
Market Zoom: UAE

Dubai real estate impresses in January
Dubai’s property sector has continued its impressive progress into 2023, following the achievement of a significant milestone in 2022. According to DXB Interact, over 9.8K transactions worth AED 28Bn (+69.3% YoY) were recorded in January, with apartments accounting for the majority of sales (7.4K transactions) and villas making up 1.8K transactions. Notably, apartments contributed 55% of the total sales value at AED 15.5Bn.
Property Finder data reveals that most potential property buyers (59%) are interested in purchasing apartments, while 41% are seeking villas or townhouses. Similarly, the majority of tenants (80%) are in search of apartments for rent. Top areas for real estate investment remain consistent, with Business Bay retaining its position, followed by Dubai Marina and JVC.
Pricing for both apartments and villas has experienced growth, with a 12.5% YoY increase for apartments and 35% for villas in January 2023. ValuStrat, a real estate consulting firm, forecasts a rise in mainstream citywide prices between 7% to 10% on average for 2023. However, competition from off-plan launches and higher mortgage interest rates may put downward pressure on the secondary market, though ValuStrat predicts that residential rent increases should stabilize by year-end.
Data from CBRE also adds to the conversation on market performance, with a particular focus on rental rates. Over the year leading up to January 2023, residential prices in Dubai saw a notable uptick of 10.6%. While average apartment prices rose by 10.3%, average villa prices surged by an impressive 12.9% during the same period. As of last month, the average price per square foot for apartments in Dubai stood at AED 1,196 (USD 326), while villas commanded an average price of AED 1,411 ($384) per square foot. However, it is worth noting that these figures are still 19.6% and 2.4% lower than the high records experienced in late 2014, respectively.
Property Finder’s UAE country manager summarized January’s performance best in his following comment: “Led by a steady demand for housing and a rising inclination towards ownership, the coming months seem to behold a great spike in property investments. With evolving consumer preferences and record year-on-year success this January, we continue to behold a positive outlook for Dubai’s multi-faceted property sector, as a trusted go-to place marketplace for our customers.”
The bottom line? What he said.
Market Zoom: Saudi Arabia

Business is confident in the Kingdom
According to the latest Riyad Bank Saudi Arabia Purchasing Managers Index report, formerly the S&P Global Saudi Arabia PMI report, has shown that the PMI hit 58.2 in January 2023, marking the second-highest since September 2021.
Arab News reported that the Kingdom’s last PMI on record stood at 56.9 in December, while in November, the index was 58.5, the highest in the last 16 months. These records are a good indication of positive economic sentiment, as any reading above 50 points to expansionary territory, while anything below that is a signal of a contraction. Naif Al-Ghaith, chief economist at Riyad Bank declared that “this growth confirms the [Kingdom’s] position as the fastest-growing economy among the G20 countries despite economic headwinds.”
Learn something new today… We asked ChatGPT to explain the PMI in simple terms, and what we got is pretty good! Check it out: The Purchasing Managers’ Index, or PMI, is a way to measure how well businesses are doing in a country. It’s like taking the temperature of the economy.
👉Basically, the PMI is a survey that asks people who work in different businesses whether they are buying more or fewer supplies and materials, whether they are hiring more or fewer workers, and whether their business is growing or shrinking.
👉The answers to these questions are used to calculate a score, which tells us whether the businesses in the country are growing or shrinking. If the PMI score is above 50, businesses are doing well and growing; if it’s below 50, it means businesses are struggling and shrinking.
Back to the KSA… The report went on to comment on non-oil activity levels and their sharp growth in January, with around a third of all surveyed companies seeing an uplift. This is further confirmed by government data that revealed the economy grew by 8.7% in 2022, boosted by robust oil and non-oil sector activity. As a result, the Kingdom recently announced a national budget size worth SAR 1.11Tn for 2023 and expects a SAR 16Bn surplus, equivalent to 0.4% of its GDP.
This estimate is higher than its previous forecast for SAR 9Bn, disclosed in a pre-budget statement 3 months ago.
The bottom line? The PMI report coupled with the economy’s impressive performance in 2022 is a clear indicator of the Kingdom’s resilience and continued progress in the face of economic headwinds. The record-breaking figures and increased budget size demonstrate confidence in the country’s economic prospects and a commitment to maintaining a stable and prosperous business environment. With the ambitious Vision 2030 plan and persistent efforts to diversify the economy, Saudi Arabia is poised to become a global economic powerhouse and an attractive destination for foreign investors.
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