2022 saw the sale of 219 residences in Dubai for an average price of over $10 million, easily setting a record for the city’s real estate market. The annual total was 20 units or less in the years preceding to 2021 when there were 93 such sales of residences costing $10 million or more. The whole just exceeded 31 in 2015, according to a fresh update from Knight Frank.
In fact, 2022 was the year when Dubai saw a flurry of property sales for over Dh100 million, with the biggest being a villa on the Palm Jumeirah that sold for just over Dh300 million. As Dubai became the preferred location for international investors, single-deal multi-property deals exceeded Dh600 million, setting new records.
2023 will see more prime property deals
“The performance at the top of the market clearly demonstrates the arrival of Dubai as a luxury hub to rival long-established markets elsewhere,” said Faisal Durrani, Partner – Head of Middle East Research. And “with no sign to suggest a slowdown in the seemingly relentless demand from global ultra-high-net-worth-individuals zeroing in on the emirate in search of second homes.
“Indeed, our 2023 Global Attitudes Survey shows that amongst the region’s wealthy, the UAE remains the second most likely target for a home purchase this year, behind the UK.
“The meteoric rise of Dubai’s multi-million-dollar homes market over the course of the last two years has been phenomenal. From just 11 ultra-prime sales in 2010, 2022 registered 219 deals above the $10 million mark – more than the total recorded between 2010 and 2020.”
Emirates Hills, Jumeirah Bay Island, and Palm Jumeirah, three of Dubai’s super-prime locations, experienced a combined 44% price gain in 2022.
Playground for the wealthy
Due to the high demand, the average square foot price in the super-prime category was Dh3,50. Even if the average price per square foot in the city is still between Dh1,000 and Dh1,200, the Knight Frank analysis claims that luxury properties in Dubai are still ‘affordable’.
“The Palm Jumeirah remains the city’s star-performer, with villa prices increasing by 49.4 percent last year, underpinned by a shortage of new waterfront villa projects in completed communities and the desire by the international elite to secure standalone beachfront homes,” said Durrani. “The exceptional demand for homes is best reflected in the fact that villa prices have risen by 96 percent since the start of the pandemic – but remain at about Dh3,000 per square foot.
“Prices are however now 34 percent higher than their 2017 peak”.
Other locations cash in
While the Palm attracted the majority of buyer interest, villas in Mohammed Bin Rashid City (up 21.6%), Dubai Hills Estate (20.2%), and District One (19.5%) held their own. Apartments in desirable areas performed as well, with those at Dubai Hills Estate up 22.7% and those at the Palm (19.7%) and Downtown Dubai following (13.8 percent). The latter two sites trade for about Dh2,200 per square foot for apartments.
“The buyer pool remains exceptionally diverse, with ex-pat residents and international high-net-worth-individuals from Europe, India, Europe, Asia the UK, and Eastern Europe still arriving in their droves” – Andrew Cummings at Knight Frank
More super-prime is being handed over
“We have also seen robust sales at newly handed over, or soon to handover, projects like One Palm, Dorchester Residences, and Atlantis the Royal,” said Andrew Cummings, Partner – Head of Prime Residential at Knight Frank. “What distinguishes these properties is the incredible architecture, world-class amenities and high-quality finishing that is new to Dubai.”