Dubai’s luxury property market experiences a surge, on par with New York and Los Angeles.
Dubai has become one of the busiest luxury real estate markets in the world, following New York, Los Angeles, and London. In 2021, Dubai recorded 219 sales of properties worth $10 million or more, making it the fourth busiest city in the world for high-end property sales, according to property consultant Knight Frank. New York registered 244 such sales, Los Angeles recorded 225, and London had 223. Additionally, Dubai was the fifth most active city for sales worth $25 million or more, with 26 transactions.
According to Faisal Durrani, the head of Middle East research at Knight Frank, “Dubai has arrived.” The concentration of wealth in the city has been catalysed by a range of factors, from the government’s decisive response to the pandemic to the introduction of new residency visa options. The handling of the pandemic and the liberal visa policies have attracted foreign buyers, and demand for property in Dubai is booming.
The luxury end of the real estate market in Dubai, including waterfront villas on the city’s man-made palm-shaped islands, is benefitting from an influx of wealthy investors. Russians seeking to shield their assets, crypto millionaires, bankers fleeing strict Covid restrictions in Asia, and rich Indians seeking second homes are among those investing in the city. Dubai is also becoming a favoured destination for hedge fund traders, who are drawn to its ease of doing business, tax-free status, and status as a global travel hub.
Knight Frank reported that just over one third of ultra-high-net-worth individuals in the Middle East grew their wealth in 2022 by more than 10 per cent. Despite its luxury status, Dubai is one of the world’s most “affordable” luxury home markets. According to Knight Frank’s 20 global prime residential markets, Dubai ranks 16th. In today’s market, $1 million will buy 1,130 square feet (104.98 square meters) of residential space in prime districts such as the Palm Jumeirah, Emirates Hills, or Jumeirah Bay Island. This is four times more space than is available for the same price in New York, London, or Singapore.
Dubai’s growing popularity as a luxury real estate market is also reflected in the fact that it is becoming increasingly attractive for foreign investors. The city has always been an international hub for commerce, tourism, and entertainment. However, its position as a top luxury real estate market is expected to add to its appeal for wealthy investors from around the world. The real estate market in Dubai is expected to remain buoyant for the foreseeable future, with many analysts predicting continued growth in demand and prices. As a result, the luxury real estate market in Dubai is likely to continue to attract more wealthy investors, both from within the region and around the world.
