The Dubai property market has not only proved to be resilient during the COVID-19 pandemic, but is now experiencing unprecedented growth. The Dubai Land Department (DLD) registered 84,196 real estate transactions in 2021, with a value of almost AED300 billion – the highest ever in Dubai’s recorded history.
However, it’s not just developers and real estate companies that can benefit from the thriving Dubai property market. Boosts in sales and revenue will also impact related industries – most notably, those in the smart technology space.
Here’s a look at 3 sectors set to benefit from Dubai’s buoyant real estate market – and the opportunities they present for innovative tech startups and investors.
PropTech is transforming the real estate industry across the globe. Property technology tools are streamlining processes, eliminating the stresses of home-buying, and enhancing the experience for agents, brokers, and customers alike.
PropTech technology trends include:
- Big Data collection and analysis of property data
- AI and cloud-based software to streamline administration tasks
- Virtual Reality tools to enhance the property viewing experience
- IoT ‘smart’ network devices and sensors for efficient property maintenance
- Online platforms and chatbots to facilitate the customer experience
Globally, the two biggest PropTech markets are the US and Europe. The UAE has been slower in adopting property technology; but thanks to UAE Smart Government and Smart Dubai initiatives, the PropTech sector offers great opportunity for growth in the MENA region.
Government support will be a major factor in the growth of the UAE PropTech market. As part of its NextGenFDI initiative – a campaign to attract digital companies and talent to the country – the Government has launched a National Programme for Coders. The programme aims to attract and train 100,000 of the world’s best coders who will be offered Golden Visas to fast-track their relocation to the Emirate. The programme provides an infrastructure that will support talented international and national coders by offering the ideal environment to promote innovation and nurture ideas.
As part of the NextGenFDI initiative, the UAE also aims to set up 1,000 new digital companies over the next five years and increase investment in tech startups from AED 1.5 billion to AED 4 billion.
These government initiatives not only help to accelerate the growth of PropTech in the UAE, but also offer fantastic opportunities for tech startups and investors in the sector.
2. Sustainable construction
As host country for the UN Climate Change Conference, COP28 in 2023, the UAE is more committed than ever to reducing carbon emissions and achieving its goal of ‘Net-Zero by 2050’.
Focus, therefore, is clearly on the construction sector of the real estate industry, which is responsible for almost 40% of global CO2 emissions.
In order to fulfil the demands of a growing real estate market while upholding its commitment to a sustainable future, the UAE is set on implementing ‘green’ solutions in the building and construction process.
Advanced technologies such as AI, robotics, IoT and BIM modelling can play a major part in helping the industry move towards sustainable construction and development.
Examples of the use of technology in sustainable construction include:
- AI-powered generative design software to optimise 3D Building Information Modelling (BIM) in the planning, designing and construction stages.
- Green building technology such as solar power, green insulation and biodegradable materials that increase the energy-efficiency of buildings, while reducing surplus waste products and contaminants.
- Cloud-based construction management systems to optimise productivity, increase efficiency and reduce waste.
- Modular construction – off-site construction in a factory setting drastically reduces waste materials, while automated robots, used to assemble the components, can significantly speed up the production process.
The construction industry as a whole, has been slow to adopt emerging technologies. But the need to develop sustainable solutions for the entire construction process – from planning and design to post-construction completion – is accelerating the integration of technology in the sector.
3. Smart home technology
Another sector that will benefit from the UAE Government Smart City initiatives and sustainability goals, is the smart home technology space.
As the Dubai real estate market evolves, and new residential developments are launched, the demand for smart home solutions will grow. Currently worth almost USD$ 60 million, revenue in the UAE smart home digital market is predicted to rise to over USD$ 96 million by 2026. The number of households actively using Smart Home technology, is expected to reach 0.4 million by 2026.
Concerns about home security (especially for the elderly), technological advancements improved living standards, and the Government’s Smart City plans, are all major drivers in the growth of the smart home market in the UAE. However, increasing customer awareness and higher expectations will only fuel the demand for more sophisticated and innovative smart home features.
Today’s buyers and renters have come to expect homes equipped with smart technology automation such as centralised control of lighting, temperature, security, entertainment systems and appliances. The COVID-19 pandemic has also inspired a growth in demand for health tech in the home – for example:
- Smart toilet sensors that can analyse waste and skin, and alert the user to underlying health issues
- Touchless tech such as doorbells that announce the arrival of visitors without the need to touch a surface and potentially contaminate it
- Coronavirus doorbells equipped with thermal sensors to detect if a visitor has COVID-19 symptoms by scanning their fingerprint
The fast-evolving smart home market offers a great opportunity for innovative tech startups to create and develop adaptable technology that can integrate with, and enhance, existing smart home systems.
The added benefits of setting up business in Dubai
Those looking to set up a business and re-locate to Dubai, can benefit directly from a lucrative real estate market that’s set to grow even further. Increasing property values and high rental returns give you the possibility of achieving a very healthy ROI further down the line.
Re-locating to Dubai also means you’ll benefit from:
- A world-class infrastructure and business hub specifically catering to business set up and startups
- Access to various funding options including Venture Capital, startup accelerator programmes, crowdfunding, and peer-to-peer lending (P2P)
- Government initiatives to attract foreign investment and advanced technology talent, such as NextGenFDI and Golden Visas as part of the National Programme for Coders
- Significantly higher rental yields compared to global cities such as London, New York, Hong Kong and Singapore
- A high standard of living in a modern, vibrant, and tech-savvy city
- No personal income tax or property tax on homes such as Capital Gains and Stamp Duty
- A dedicated ‘Ministry of Happiness’ to promote and enhance wellbeing, happiness, and quality of life for all residents in Dubai
- A safe and secure environment – the UAE is rated as one of the safest countries in the world, while Dubai has exceptionally low crime rates compared to other international cities
Add to these, Dubai’s aim to become the smartest city on the planet, and a forward-thinking government actively driving innovation – it’s easy to see why the Emirate city has become such a desirable location for startups, talent and investors seeking new opportunities in the tech space.