Dubai real estate sector is booming and the sector is expected to further grow this year as well. Luxury properties have reigned Dubai real estate sector and this segment is also set to see the strongest growth in 2023, owing to the rising demand from high-net-worth individuals, scarce supply and relatively fewer launches. The prices for properties in Dubai are expected to sustain or grow in an upward trend. A majority of wealthy real estate investors also betting on luxury properties would do best by putting their money in the world’s best performing real estate markets, next year.
Dubai real estate – The world’s top luxury market
Dubai real estate touched the AED30 billion mark, this November and meanwhile, in the rank of the world’s top luxury real estate markets, Dubai topped the list, where prices are expected to increase 13.5% in 2023, according to Knight Frank’s findings. Miami secured the second spot with prices expected to increase by 5% in 2023. Followed by Dubai and Miami are Dublin, Lisbon and Los Angeles, with a 4% expected increase.
Seeing the report and ranking, it is clear that the world’s several luxury property markets are expected to cool in 2023, due to an increase in interest rates, imminent global recession threats and economies turning down. However, Dubai is not part of these markets that will face any downturn and prices are expected to rise exponentially here, due to rising demand both from local and international investors.
The highest in-demand neighbourhoods in Dubai
Several Dubai prime areas are in higher demand with property prices up by 90%. It indicates the level of demand for luxury properties for sale in prime areas of Dubai. For instance, during H1, 2022, the prime districts including Palm Jumeirah offering luxury waterfront properties remained the highest in demand. Prices for luxury properties for sale in Palm Jumeirah and other prime neighbourhoods increased exponentially due to tight supply and high demand.
Dubai Hills Estate also recorded massive growth in terms of the number of transactions and price hikes. It is a secluded neighbourhood that appealed to people who wanted to live next to the bay, canals and areas surrounded by parks and open green spaces. According to an estimate, Dubai Hills Estate grew by 53 per cent in terms of price hikes.
There are a few underestimated neighbourhoods as well that have not touched their price limits yet and will show tremendous growth in 2023. For instance, prices for properties in Jumeirah Village Triangle grew by 62 per cent in 2022 but the values are expected to increase by 29 per cent in 2023 as well.
Dubai real estate market will see an upward growth trend in 2023, with prices in some areas will grow by up to 46 per cent. Otherwise, property prices will increase steadily as well around 10 to 15 per cent.
Dubai real estate market ended year on a positive note
2022 is ended and termed a record-breaking year for Dubai real estate market. Dubai real estate sector is booming and it is all set for further growth this year, with a projected growth of 46 per cent. International investors attract to Dubai’s safe haven status due to which they prefer investing in Dubai real estate, seeking to protect their assets from geopolitical crises.
According to data released by Realiste – a Dubai-based PropTech company, prices for properties for sale in Dubai grew by 20 to 40 per cent, in the last one year. A few areas also showed an even bigger upturn including Palm Jumeirah showed 59 per cent growth and Trade Centre First grew by 210 per cent.
Dubai – A real estate and financial hub in the region
Dubai became one of the few beneficiaries of geopolitical crises and in 2022, it saw a major influx of millionaires investing in luxury properties for sale in Dubai. According to an analysis, more than 16% Russians millionaires and entrepreneurs invested in Dubai real estate, after the unrest in the country due to the war with Ukraine – in the first half of the previous year. Resultantly, it was recorded that Russians surpassed Indians and become top property buyers in Dubai.
Besides the global crisis, Dubai real estate market performed exceptionally well during the second half of 2022 and profited well from Qatar’s FIFA World Cup. Dubai kept its charm alive and a majority of FIFA World Cup visitors showed high interest in Dubai real estate projects, due to the city’s status as a tourist attraction and financial hub of the region.
According to Alex Galtsev, CEO of Realiste, “Dubai will remain attractive to foreign buyers who are seeking to shield their assets. It will strengthen its position as the geopolitical instability and energy crisis grow. As a result, there will be a further boost in demand for local property and the market in 2023.”
DLD launched a strategic plan
Dubai is a global financial hub and boasts to have a number of fastest-growing investment sectors including real estate. And to make the most of it, the Dubai Land Department (DLD) has launched a strategic plan to position Dubai as the world’s leader in real estate investment markets.
The strategic plan will be implemented till 2026 and aims to revolutionize Dubai real estate sector. Primarily, the plan is to provide seamless real estate services in Dubai while implementing effective legislation and providing human capital for the sector to grow and evolve. Moreover, it is also planned to increase the real estate sector’s contribution to the country’s GDP, which will in turn play a crucial role to help Dubai become one of the strongest, most-developed and fastest-growing economies in the world.
The strategy is based on five main pillars including:
- Enhancing Dubai real estate sector’s readiness and sustainability, while ensuring an effective governance
- Making Dubai a real estate incubator by fostering a safe environment and harnessing tech-based real estate solutions
- Focusing to develop a data-driven approach
- Promoting a digital ecosystem in Dubai real estate sector
- Shifting to an employee-first culture and adopting a human-focused approach
This all leads to a prosperous 2023 for Dubai real estate sector because not just the real estate departments but the UAE government is fully focused to enhance and improve Dubai real estate sector to make it a profitable investment sector for the UAE’s economy.
If you are also planning to be a part of this growing Dubai real estate market, call the team HFRE at +971 4876 2473 or write us at info@hfre.ae to register your interest.
