Dubai has been capturing global headlines throughout 2023 for its stellar luxury, residential, real estate performance.
Dubai’s ultra-prime home sales reached US$ 1.6 billion in Q3 of this year, with luxury home sales priced over US$ 10 million reaching a count of 277, surpassing figures from New York, Hong Kong, and London, according to consultancy Knight Frank.
In its Q2 2023 Prime Global Cities Index, the consultancy said that Dubai’s residential prices soared by 225% compared to a pandemic influenced low in Q3 2020.
In addition, the report revealed the city has held the number one position for the annual price growth of properties for eight straight quarters.
In its Q3 2023 Prime Global Cities Index, the report said the emirate moved into second position in the consultancy’s global ranking, due to a slowing in quarterly price growth from 11.6% tracked in Q2 to 0.7% in Q3. Although growth slowed from Q2 to Q3, the figures still represent nine consecutive quarters of growth.
Dubai luxury real estate 2024
Looking to 2024, Dubai is in a strong position to continue attracting tourists, investors, and immigration, in turn maintaining a steady growth of its real estate market.
The UAE government’s on-going focus on the implementation of economic and social initiatives designed to sustain long-term, economic growth can be seen via the likes of the golden visa scheme, open trade with most countries and the hosting of global events, such as the imminent COP28.
100% direct foreign ownership
Initiatives such as allowing 100% direct foreign ownership in more than 1,000 commercial and industrial practices, the introduction of insolvency laws, improving the ease of doing business, introducing multiple-entry tourist visas, minimal taxation, and others will continue to have a positive impact. In addition, the UAE as a whole has diligently maintained its status and reputation as a safe haven for investment amid global uncertainties, which will continue to drive investors to scoop up first and second homes.
Knight Frank report
According to data from Knight Frank, $4.91 billion has been spent on luxury homes in Dubai alone, this year to date, with $1.59 billion being spent on homes worth $10 million or more in Q3 2023 alone.
Emaar Properties report
A resurgence in demand from investors from markets such as China and India is also expected to contribute to future growth in the emirate’s luxury real estate sector in 2024.
According to developer Emaar Properties, Chinese investments into its projects roughly doubled to comprise 7% of its total sales in the first half of 2023, from 3 to 4% in the same period in 2022. For Chinese buyers, returning to Dubai’s property segment is being fuelled by the relaxation of imposed travel restrictions and a slowing of China’s economy.
Luxury homes, the main attraction
Despite significant growth in luxury home asking prices in Dubai in the last 12 months, investors are likely to continue flocking to the emirate in 2024 as its luxury homes remain attractively priced compared to those in London, New York, and other global real estate markets. Real estate experts note that $1 million will buy 33 square metres (sqm) in New York or 34sqms in London, where the same price will secure a 105sqm home in Dubai, thus representing significant value for money for both residents and investors.
Branded apartments and townhouses
Another luxury real estate trend that is likely to continue its upward trajectory in 2024 is the branded apartment and townhouse segment. In 2022, branded apartments made up a fifth of the value of all apartment sales in Dubai and the appetite for branded homes has only grown in 2023.
A buyer recently agreed to pay $55.3 million for a five-bedroom Baccarat-branded apartment in Dubai, while in February of this year, a five-bedroom apartment was sold in the Bulgari Lighthouse for $43.6 million.
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Estilo Architects beat its own record this year, previously set in 2022, for the highest value property sold on the Palm Jumeirah, to date, at $41 million. Four dozen branded projects are already present in Dubai, and – as per Savills – the city is said to have the most branded schemes in its development pipeline of any market in the EMEA region by 2030, thus indicating significant confidence in this segment by developers.
According to Standard & Poor, the UAE economy is forecasted to grow 4% in 2024, driven by the non-oil sector, which is expected to benefit from growth in tourism, government initiatives, and technological advancements. The strong economy, the continued influx of foreign investments (as a result of its safe and stable environment) and rising population levels will all contribute to growth in the luxury real estate segment in 2024.
Estilo’s future plans
Estilo has plans to complete as many as 18 luxury properties, with another 42 set to begin design phase, in Dubai’s luxury real estate locations such as, The Palm Jumeirah, Dubai Hills, Emirates Hills and latest, predicted hotspot, Jumeirah Palm Islands. The architecture and design studio also anticipates an increase of up to 15% in listing prices in 2024.
tanvir@dubainewsweek.com
