Dubai is one of the world’s most ‘cheap’ luxury residential marketplaces. The Palm Jumeirah, one of Dubai’s most prestigious locales, has seen prime price growth of more than 100% since the pandemic began. Premium home prices in Dubai’s most desirable neighbourhoods surged 89% in the last year, although prices are growing from a low foundation.
According to a recent Knight Frank research titled ‘Dubai Residential Market Review Winter 2022-23,’ average transaction prices in Dubai are AED 3,220 per square foot (psf), or roughly US$ 870 psf, making Dubai one of the world’s most ‘cheap’ luxury residential markets. One AED – United Arab Emirates Dirham is about Rs 22.50 in Indian Rupees.
The city’s most costly neighbourhoods continue to have the best performing submarkets. Villas on the Palm Jumeirah continue to see the steepest price increases, with average transacted prices exceeding the AED 3,500 psf level, jumping by 6.9% in Q3 and remaining 48.2% higher than this time last year.
Dubai is recognised for its opulent lifestyle, and it is home to some of the world’s most costly areas. Following are some of Dubai’s most costly neighbourhoods:
- Palm Jumeirah: This man-made island is one of Dubai’s most affluent communities. Some of the most costly villas and apartments in the city may be found here, with prices ranging from AED 15 million to AED 100 million or more.
- Emirates Hills: Located near the Montgomerie Golf Club, this gated enclave is recognized for its magnificent villas and mansions. Emirates Hills property prices range from roughly AED 15 million to AED 100 million or more.
- Downtown Dubai: This district is home to some of Dubai’s most recognizable monuments, including the Burj Khalifa and the Dubai Mall. It is also one of the city’s most expensive areas, with prices for luxury flats and penthouses starting around AED 5 million and rising to AED 50 million or more.
- Jumeirah Islands: Located on an artificial island, this affluent neighborhood is noted for its huge residences and abundant flora. Property prices in Jumeirah Islands start from AED 6 million and can reach AED 30 million or more.
- Al Barari: This neighborhood is noted for its eco-friendly and sustainable design and is located near the Dubai Miracle Garden. Homes in Al Barari range in price from roughly AED 6 million to AED 100 million or more for a customized villa.
Zooming in on Dubai’s prime markets, which include the Palm Jumeirah, Emirates Hills, and Jumeirah Bay Island, reveals even faster price rise than the general villa market. Prime values continue to rise, increasing by 29% in the third quarter of 2022 alone. It is vital to note that these are relatively exclusive communities that cater to a high-end clientele. Costs for properties in these communities can vary substantially based on the property’s location, size, and amenities.
The price increases are being driven by a lack of new supply and high inflows of UHNWI looking for second homes in Dubai’s top areas. This pattern contrasts sharply with the emirate’s two prior market cycles, in which the predominant buyer profile was associated with buy-to-let or speculative acquisitions.