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Majid Al Futtaim, a leading shopping center, neighborhood, retail and leisure pioneer in the Middle East, Africa and Asia, has released the ‘State of the UAE Retail Economy’ fourth quarter report, which reveals overall consumer spending will grow by 19% in 2022 compared to the previous year. Compare.
Spending in the retail economy grew a notable 13% for the year, which includes leisure and entertainment (29%), fashion (25%), hypermarkets and supermarkets (11%), and general retail (9). Driven by rising international tourists to the UAE, which more than double to 14 million by 2022, thanks to major events including the FIFA World Cup in neighboring Qatar. long-term growth. “
The UAE posted its strongest annual GDP growth since 2006, jumping to 7.9% in 2021 from 3.9%. The drivers of this growth are broad and span oil and non-oil industries. As expected, oil remained a major component as average oil prices rose about 38%, leading the sector to rebound to growth of 11.4% after contracting 0.7% the year before.
The non-oil economy showed strong growth at 6.6%, boosted by government efforts to attract investment and boost tourism in the country. In the last quarter of 2022, people became more cautious about their spending, opting for discounts and deals on essential items and reducing purchases of non-essential items such as electronics. Average spend per transaction in hypermarkets and supermarkets fell by 3% during the year, but total spend in this segment was up 11% year-on-year, suggesting that basket value is moving towards smaller shopping values and more frequent transactions develop.
The extended 2.5-day weekend also weighed on growth in consumer spending, with weekend retail sales up 11.3% over the previous year. According to Majid Al Futtaim point-of-sale (POS) data, this translates into approximately AED5.5 billion in additional spending.
Some 90 percent of respondents to Majid Al Futtaim’s Happiness Lab survey had a positive view of the current economic situation in the UAE. Majid Al Futtaim POS data suggests that this optimism is evidenced by the peak in absolute consumer spending in the fourth quarter of 2022, which accounts for 29% of all retail economic activity for the year. Analysis shows that the UAE has the fastest growing e-commerce market in the world, with sales expected to reach $9.2 billion by 2026. Spending in this space will peak in the fourth quarter of 2022, a full-year increase of 20% compared to 2021, with three – a quarter of consumers saying digital payment methods are preferred, according to Majid Al Futtaim POS data.
Fintech solutions such as buy now pay later (BNPL) are growing rapidly, with 45% of consumers using buy now pay later (BNPL) financing in the past year, up from 21% a year ago.
The majority of online spending by residents occurs in the hypermarket and supermarket sectors, where spending rose by 40% during the year.
The real estate industry witnessed a record-breaking year, with property sales hitting 12-year highs in both volume and value.
Compared to 2021, the volume of transactions has increased by 60%, and sales will increase by 76% in 2022 to reach AED 265 billion. The market peaked in the fourth quarter with 27,000 transactions, up from 16,000 a year earlier.
According to data released by the Dubai Land Department (DLD), a total of 3,903 real estate transactions worth AED10 billion were carried out in Dubai in the week ending 17 March 2023.
The DLD report showed that 208 plots were sold for AED 1.12 billion, while sales of 2,906 apartments and villas totaled AED 6.25 billion.
The top three deals were three parcels of land in Al Jadaf, which were sold for AED 38.5 million, AED 38.5 million and AED 37 million.
Al Hebiah Fifth had the most deals this week with 88 transactions worth AED 232.71 million, followed by Jabal Ali First with 22 transactions worth AED 72.92 million and Madinat Hind 4 with 20 transactions worth AED 25 million m.
The top three for apartment and villa transfers were a villa on Palm Jumeirah for AED150 million, an apartment on Island 2 for AED80 million, and a condo on Palm Jumeirah for AED150 million. Another apartment sold for Dh65 million.
The value of mortgaged properties this week was AED 2.17 billion.
Dubai’s real estate market recorded 635 sales transactions worth AED1.56 billion on Thursday, in addition to 107 mortgage transactions worth AED505.91 million and 31 gifts, data released by the Dubai Land Department (DLD) showed Transaction, worth 69.08 million dirhams.