The supply of luxury homes for sale in Dubai has decreased by almost 50% over the past year, primarily due to a surge in demand from wealthy individuals. Data from global real estate firm Knight Frank reveals a 47% drop in available properties, totaling 2,851, in upscale areas like Palm Jumeirah, Emirates Hills, and Jumeirah Bay Islands. This trend indicates that purchasers are either end-users seeking personal residences or investors anticipating further price increases.
Dubai recorded sales of 190 homes worth over $10 million in the first half of 2024, nearly matching the 189 sales in the same period last year. Additionally, the market for ultra-luxury properties priced at $25 million or more remained robust, with 15 sales in the second quarter, bringing the first-half total to 21.
The UAE has become a preferred relocation spot for millionaires in recent years. According to Henley & Partners, Dubai hosts 72,500 millionaires, 212 centi-millionaires, and 15 billionaires, with a millionaire growth rate of 78% from 2013 to 2023. Faisal Durrani, a partner at Knight Frank, noted that the intense interest from the global super-rich has significantly reduced the supply of luxury homes in areas like Emirates Hills and Palm Jumeirah.
Private investors are planning to inject $4.4 billion into Dubai’s property market, attracted by its competitive pricing and potential for high capital appreciation and rental income. Michael Gelpke of Glam Properties highlighted the diversification of investor profiles and the shift towards end-user markets, driven by factors like the Golden Visa program and long-term residency plans.
Akshay Nagdev from Foremen Fiefdom observed a strong demand for luxury villas in prime locations like Dubai Marina and Downtown Dubai, favored for their upscale lifestyles and proximity to business hubs. The preference for larger homes among Golden Visa holders to accommodate families has also boosted interest in high-end properties.
Knight Frank's data shows Palm Jumeirah leading with 853 home sales in the first half of 2024, representing 89.3% of luxury sales. Average transaction prices in Dubai’s elite neighborhoods rose by 7% year-on-year to Dh3,706 per square foot. Durrani emphasized the market's shift towards 'buy-to-hold' strategies, with international high-net-worth individuals primarily buying homes for personal use rather than speculative flipping.
