Premium properties command $2,400 per sqft as new prestige neighbourhoods come on-stream
Dubai recorded 88 home sales above US $10mn during the first quarter, according to the latest analysis carried out by global property consultant Knight Frank.
The firm’s analysis also shows that the city’s prime residential neighbourhoods of the Palm Jumeirah, Emirates Hills and Jumeirah Bay Island continue to dominate luxury home sales, with average transacted prices in these highly sought-after locations for $10mn homes reaching $2,400 per sqft during the first quarter. Other locations in the city are, however, also fast rising to prime status.
Faisal Durrani, Partner – Head of Middle East Research, Knight Frank said, “The $10 million-plus homes market in Dubai continues to strengthen, with 88 sales being registered in Q1 alone. 2022 saw Dubai record 219 deals above this price point, positioning the city as the fourth busiest luxury homes market in the world. 2023 is shaping up to be another record year for this segment of the market.”
“The depth of demand for homes at this price point from local and international UHNWI [ultra high networth individuals] is helping to drive up prices in this exclusive segment of the market. Indeed, Q1 has seen average transacted prices for $10mn-plus homes reach $1,970 per sqft, which represents a 16% increase on 2022’s $1,700 per sqft.”
In mid February 2023, a Deloitte report said it anticipates growth across residential and commercial sectors in 2023 in Dubai and Saudi Arabia and, in late February, Q Properties said the latest phase of Reem Hills sold out.
While Dubai’s prime neighbourhoods of the Palm Jumeirah, Jumeirah Bay Island and Emirates Hills accounted for 64% of the $10mn home sales during Q1, other areas are also growing in prominence and are likely to be classed as ‘prime’ if they continue to entrench themselves as high-end neighbourhoods, the Knight Frank study shows. The Al Wasl-Dubai Canal corridor is one such area, with branded residential sales contributing to its emergence as a hotspot for UHNWI who are focused on securing the most expensive homes in the emirate’s most desirable neighbourhoods.
Andrew Cummings, Partner – Head of Prime Residential Sales, Knight Frank added, “Tilal Al Ghaf is the other location that has quickly joined the growing list of ultra-lux neighbourhoods in Dubai. Last year, three homes here sold for over $24.5mn and during Q1, seven villas transacted for over $10mn, strongly suggesting that Tilal Al Ghaf will soon meet our definition for a prime neighbourhood.”
He concluded, “While the bulk of international UHNWI looking at Dubai are drawn to acquiring second homes on the coast, Tilal Al Ghaf has set a new benchmark for luxury living as an inland community that delivers on quality and amenities. The shortage of completed waterfront communities and the lack of development sites that can be easily activated suggests that such inland communities will continue to grow in prominence.”
In late February 2023, W Capital said Dubai’s Golden Residency Visa could boost real estate in the emirate.