Dubai’s mainstream real estate market prices are up 13% year on year, but still 15% below the 2014 peak
06 June 2023, 12:00 AM
31 July 2023, 12:00 AM
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.
Faisal Durrani, partner and head of Middle East research said, “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."
According to Knight Frank’s The Wealth Report 2023, the value of the Prime International Residential Index (PIRI 100) which tracks the movement in luxury house prices across the world increased by 5.2% YoY in 2022. The prime residential prices in Dubai accelerated 44.2% in 2022, maintaining its position at the top of Knight Frank’s PIRI 100 and cementing its status as a global hub for ultra-high-net-worth individuals (UHNWIs), assisted by numerous visa incentives.
“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,” Durrani 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.