The booming demand for luxury real estate in Dubai attracts the global elite
With the current boom in demand for luxury real estate, Dubai is increasingly attracting the world’s elite, surpassing London, Los Angeles, and other cities in terms of sales of homes worth more than US$10 million.
Currently, Dubai is one of the world leaders in luxury real estate sales and branded residences.
Dubai’s luxury housing market, including villas for sale in Abu Dhabi, has seen extraordinary growth in recent years as wealthy clients flock to the emirate to purchase real estate, which has allowed Dubai to surpass cities such as London and Los Angeles in the luxury real estate market, according to experts.
History of the local real estate market
Before 2020, the luxury market was not as booming as it is now, notes Chris Whitehead, managing partner at Dubai Sotheby’s International Realty. “With the pandemic, political instability, and conflicts around the world, [Dubai] has seen an influx of wealthy people seeking a more comfortable climate, a higher standard of living, and low taxes. Combined, the above factors have created a high demand for luxury real estate, and we see Dubai outperforming some cities in this market segment.”
According to Mr. Whitehead, supply in this market segment has increased dramatically. “Not only has the quality [of luxury real estate] increased, as every developer is looking to outperform their competitors to increase sales, but also the number of serviced properties has increased as they cater to the needs of wealthy people looking for a more comfortable lifestyle. This, in turn, contributes to positive pricing, and it is readily accepted as demand exceeds supply.”
Since the pandemic, he said, real estate prices of apartments for sale in Dubai Hills in the city have increased by a staggering 33% and rental values by about 42%.
Changes in the real estate market
“The real estate market in Dubai has become more international, and I have learned that many people, especially from Europe, are now investing in Dubai,” Mr. Remus said, adding that he has witnessed a surge in the number of wealthy European clients buying property in the emirate for winter holidays.
Policies to attract foreigners have led to a massive increase in Dubai’s international appeal. Along with introducing the Golden Visa, government initiatives aimed at retired expats and business owners have attracted increased interest.
With the city’s population expected to reach 5.8 million by 2040 and the residential real estate market expected to grow by more than 8% annually, the emirate’s position in the international luxury real estate market continues to strengthen.
Analysis of the new trend in the real estate market
Dubai is becoming a destination for wealthy individuals worldwide due to the high quality of life the emirate offers despite its climate. According to a report published in 2022 by global network InterNations, the UAE ranked sixth among the best countries for expatriates to live and work in, up 12 places from the previous year. When choosing a place to live, aspects such as safety, the level of education and medicine, the degree of infrastructure development in general, and the amount of taxes matter. The last point is particularly attractive. The country has no income tax, and the corporate tax introduced in May 2023 is one of the lowest in the world – 9%.
The beginning of 2023 is more than optimistic. The upward trend in sales and real estate prices continues.
