As the premier residential category has expanded at the fastest pace in the globe over the previous year, analysts claim that true end-users are now driving Dubai’s residential market rather than speculative activities.
Prices in the emirate’s primary real estate market are risen 13% from the previous year, although they are still 15% behind their 2014 peak. According to international real estate firm Knight Frank, certain areas have surpassed the level from 2014.
“Prime residential prices rising by almost 55 percent 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.
The premium real estate sector in the emirate has experienced record-breaking growth over the last 15 months. The most costly properties have been sold in the emirate, with one on Palm Jumeirah fetching Dh600 million. A brand-new, ultra-luxury apartment in the Bugatti Residences by Binghatti has been listed for sale for Dh750 million, therefore this record is about to be broken shortly.
Millionaires who arrived following the pandemic have increased demand for luxury homes across all market categories.
“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.
In its first edition, the report surveyed 183 billionaires worldwide who each had a net worth of at least $3 million, excluding their primary property or principal residence.
“Gone are the day when we have speculative activities in the market like we did in 2009 and prices collapsed 60 percent over two quarters of 2009. Those days do appear behind us because the market is driven by genuine end users,” he added.
A significant proportion of HNWIs are interested in purchasing completed homes rather than off-plan, according to the head of regional research at Knight Frank.
“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.