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Dubai sees big demand surge for affordable luxury homes

Dubai’s luxury properties will remain strong in the second half of 2023

Published: Thu 5 Oct 2023, 4:17 PM

By
Issac John

General view of the Discovery Gardens community in Dubai. — KT file

Affordable luxury residential sector, a key segment driving Dubai’s overall real estate boom, is expected to see a sustained strong demand growth on the back of a steady stream of wealthy individuals flocking to the city, lured by its charm as a safe and booming luxury haven.

More developers are coming forward to unlock the potential of this market segment, which is facing a supply shortfall due to fast growing demand from millennials who are ready to pay more for less space in prime neighbourhoods, property consultants said.

Dubai’s luxury properties will remain strong in the second half of 2023 and will be the fastest-growing market among all the major cities around the world on the back of the continued inflow of millionaires, with the market facing a supply shortage of high-end units.

Savills Research predicts that prices of prime residential property in Dubai will increase between 6 to 7.9 per cent in the second half of 2023, the fastest pace in the world, followed by Singapore and Bangkok. Benefiting from the continued relocation of professionals and millionaires, Dubai will remain a sought-after destination for overseas investors, analysts said.

Kalpesh Kinariwala, founder of Pantheon Development, a leading player in the affordable luxury home space, says he is highly optimistic on the Dubai real estate market. “The resilience of Dubai’s realty sector, especially post-lockdown, vouches for its potential to create long-term value. It is a market that rewards innovation and quality, the two tenets that we stand by,” he said, adding that the new projects will continue to nurture and redefine the affordable luxury as well as luxury property space in Dubai.

Kinariwala said the current real estate boom was sparked by Dubai World Expo that brought to the country more than 26 million visitors, who were enchanted by the varied advantages and attractions of Dubai, including its affordability. People from Europe, Russia, India and other Asian countries flocked to the country, attracted by the city’s safety, quality of life and the world-class healthcare system. Prices of units in middle to high-end areas more than doubled with prices in certain areas hitting record highs in the past two years.

According to ValuStrat’s second-quarter estimates, the rally in the Dubai residential property prices has broadened to the affordable segment since the pandemic.

Analysts said the affordable segment of the market witnessed evident capital gains for the first time since the pandemic. Lower priced and high-yield areas observed notable quarterly growth Jumeirah Village Circle, Discovery Gardens, Motor City, The Greens and Production City, are among areas that recorded steady price increases.

Pantheon Development is planning to unveil new projects worth Dh2 billion in JVC on the back of the continuing double-digit surge in Dubai’s property market, Kinariwala said. The construction of the new projects is slated to kick off during 2023-24.

The new projects will be developed over an area of 2 million square feet, adding to the 1.3 million Sq. ft of Pantheon projects in JVC, which is a preferred and strategic location for the developer considering its robust community features and excellent connectivity.

“We are open to exploring opportunities in other locations as well in future if it adds value to our residential propositions in Dubai’s realty market,” said Kinariwala, whose completed and delivered projects in JVC include Pantheon Boulevard and Elysee I and Elysee II. The ongoing projects — Elysee 3 and Pantheon Heights – both 100 per cent sold out – are scheduled for handover in early 2024 and 2025 respectively, he said.

Recently, Pantheon Development also awarded construction and design contracts for its latest project in JVC – Dh150 million Elysee Heights - that will be developed across 200,000 Sq. ft in District 15 of JVC.