Dubai luxury real estate among the world’s most affordable markets
2 min
Dubai not only achieved a new high with the sale of 431 homes valued above $10 million each last year but also maintained its status as offering more value compared to major cities like London, New York, and Singapore.
Last year, Dubai set a new record by selling 431 luxury homes for over $10 million, while the luxury real estate segment saw a near 16% price increase. Nevertheless, Dubai is considered one of the most budget-friendly locations for purchasing luxury real estate, as stated by global property experts Knight Frank. The Wealth Report from Knight Frank highlighted that prime residential prices were robust in 2023, with Dubai being a standout in the luxury real estate sector.
Out of 100 markets analyzed in the Prime International Residential Index (PIRI) by Knight Frank, 80 showed stable or positive annual price growth. The average increase in luxury prices was 3.1% in 2023, with Manila at the forefront with a 26% increase and Dubai closely following with a 15.9% increase. Following Dubai were The Bahamas at 15%, and both the Algarve and Cape Town tied at 12.3%.
Prime residential values in Dubai, covering areas such as Palm Jumeirah, Emirates Hills, and Jumeirah Bay Island, witnessed unprecedented growth in 2023, starting from a low base, according to Knight Frank.
Faisal Durrani, the Middle East and North Africa Research Head at Knight Frank, noted that Dubai’s luxury real estate market is predicted to grow by 5% in 2024, following a 16% increase in 2023 and a 44.4% surge in 2022.
Durrani highlighted a significant 38.5% reduction in the number of prime homes for sale in Dubai in 2023, mirroring a 52% drop in the Burj Khalifa’s sales inventory. This trend indicates that homeowners are increasingly opting to retain their properties longer, reflecting a shift towards long-term residency and investment in the prime market.
Despite the surge in sales of luxury properties, Dubai remains at the lower end of the scale in terms of the world’s most expensive prime markets. Comparatively, $1 million in Dubai can purchase significantly more residential space than in cities like London, New York, or Singapore, enhancing its attractiveness to the global elite.
Will McKintosh, Regional Head of Prime Residential at Knight Frank MENA, emphasized that Dubai’s residential market has matured, with the city’s appeal bolstered by its relative affordability, safety, and lifestyle offerings. This has attracted international second-home buyers and encouraged residents to establish deeper roots, leading to the development of sought-after communities beyond luxury waterfront properties, such as the balanced lifestyle offered in Jumeirah Islands.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
Villa prices saw particularly strong growth, with capital values increasing by 33.4 percent year-on-year
< 1 min
Dubai’s real estate market showed strong performance in the second quarter of 2024, with notable increases across the residential, office, and retail sectors, according to a new ValuStrat real estate report for Q2 2024.
Villa prices experienced particularly strong growth, with capital values rising by 33.4 percent year-on-year.
Haider Tuaima, Director and Head of Real Estate Research at ValuStrat said: “The Dubai real estate market has shown impressive growth and resilience in recent months. The ValuStrat Price Index for Residential Capital Values increased by 6.4 percent quarterly and 28.2 percent annually, reaching 178.2 points.
“Despite severe flooding caused by record rainfalls in April, the quick and effective response from developers and authorities helped to control the damage, ensuring that market activity and property valuations remained robust in the subsequent months.”
The office sector also performed well, with the VPI for office capital values surging by 31.7 percent annually and 9.4 percent quarterly, reaching 212.5 points—the highest quarterly increase in a decade.
In the retail sector, Emaar Properties reported 98 percent occupancy in their prime mall assets, while overall mall occupancy stood at 96 percent during the first quarter of 2024. The hospitality sector also saw growth, with total international guests reaching 8.12 million as of May 2024, a 9.9 percent increase compared to the same period last year. Hotel occupancy reached 81 percent, rising by 1.4 percent year-on-year.
Despite these positive indicators, Tuaima added, “The decline in transaction volumes calls for a closer examination of market dynamics as stakeholders navigate this evolving landscape.”
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
