Dubai, Abu Dhabi real estate sectors diverge in March

March was a tale of two cities for the UAE’s real estate sector. While Dubai residential sales contracted in March, the Abu Dhabi market remained steady and reported growth in transactions throughout the quarter, according to 1Q data (pdf) from real estate services and advisory firm CBRE.

Dubai residential sales dropped 19% m-o-m and 11% y-o-y, a reversal of January and February momentum with 45k transactions. This cooling was visible in the off-plan secondary market, where March transactions plummeted by more than 40% m-o-m. Hospitality and luxury residential were hit the hardest nationwide.

Hotel occupancy plunged: Hotel occupancy across the UAE came in at a strong 85% in January and February before plunging when the drones started flying: Only 23% of rooms were full in Dubai, with Abu Dhabi faring better at 40%.

What to watch for next: Any signs the market stabilized in April after the ceasefire.