Dubai's prime residential market grows at highest pace globally

Emirate’s mainstream real estate market prices are up 13% year on year, but still 15% below the 2014 peak

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by

Waheed Abbas

Published: Sun 4 Jun 2023, 12:52 PM

Last updated: Sun 4 Jun 2023, 3:19 PM

Dubai's residential market is no longer driven by speculative activities but by genuine end-users as the prime residential segment has grown at the highest pace in the world in the last one year, say analysts.

The emirate’s mainstream real estate market prices are up 13 per cent year on year, but still 15 per cent below the 2014 peak. However, some pockets have exceeded the 2014 level, according to global real estate consultancy Knight Frank.

“Prime residential prices rising by almost 55 per cent in the last 12 months are the highest level of growth of any prime residential market in the world, driven by ultra-high net worth individuals buying luxurious properties in Dubai,” said Faisal Durrani, partner and head of Middle East research.

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The emirate’s luxury real estate market has seen unprecedented growth with record-setting deals in the past one-and-a-half year. The emirate has seen the most expensive properties being sold, with one of them on Palm Jumeirah going for Dh600 million. Meanwhile, this record is set to break soon as a new ultra-luxury apartment in Bugatti Residences by Binghatti has been put on sale for Dh750 million.

The inflow of millionaires after the pandemic has driven demand for luxury properties across all segments.

“The high net worth individuals have been in search of Dubai’s sun, sea and sand lifestyle and typically to attain that is to buy a villa. That’s why we have seen villa prices rocketing in the last couple of years,” said Durrani during a press briefing to launch the ‘Destination Dubai’ report by the global real estate consultancy.

The inaugural edition of the report surveyed 183 millionaires globally, each with a net worth of over $3 million, excluding their main home, or primary residence.

“Gone are the day when we have speculative activities in the market like we did in 2009 and prices collapsed 60 per cent over two quarters of 2009. Those days do appear behind us because the market is driven by genuine end users,” he added.

Knight Frank's head of regional research revealed that a good number of HNWIs are interested in buying completed homes rather than off-plan.

“When Palm Jumeirah was launched 20 years ago if you had tried to sell it to HNWIs, then it would have been a difficult sell because a better part of it has been a construction site. Now it is completed, offering schools, shopping malls, and hospitals all in place. Hence, we have relentless demand there,” he added.

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Waheed Abbas

Published: Sun 4 Jun 2023, 12:52 PM

Last updated: Sun 4 Jun 2023, 3:19 PM

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