Dubai's Prime Property Market Soars: 190 Deals Over $10M in H1 2024 Despite Supply Shortage

Dubai's prime residential market is facing a severe supply shortage, with available homes dropping by 47% over the past year to just 2,851 properties, according to global property consultant Knight Frank. This shortage is most pronounced in affluent neighborhoods like Emirates Hills, Jumeirah Bay Island, Jumeirah Islands, and The Palm Jumeirah.

Soaring Demand from the Global Elite

Faisal Durrani, Partner and Head of Research, MENA at Knight Frank, attributes this decline to relentless demand from the global super-rich.

"The global super-rich remain fixated on Dubai, overwhelming the supply of luxury homes in the city,"

Durrani explained. This follows findings from the 2024 Destination Dubai report, which noted that $4.4 billion of global private capital is targeting Dubai's residential market this year, a 76% increase from 2023.

Luxury Real Estate Market Performance

Dubai’s prime residential market has seen impressive performance in recent months. Average transacted prices in the city’s most upscale areas reached AED 3,706 per square foot in the first half of 2024, marking a 7% increase from the same period in 2023.

The Palm Jumeirah led the market with 853 home sales, representing 89.3% of prime deals. Other significant areas include Jumeirah Islands (5.03%), Jumeirah Bay Island (3.56%), and Emirates Hills (1.05%).

Dominance in the Over $10M Market

Dubai continues to lead the market for homes priced over $10 million, recording 431 sales in 2023, which is 80% higher than the next closest market, London. In the first half of 2024 alone, there were 190 additional sales in this exclusive category.

"The continued sales growth in Dubai’s $10M homes market is extraordinary, especially considering the declining number of luxury homes available,"

Durrani noted.

The number of listings for homes valued over $10 million fell by 65.5% over the past year to just 460 properties. This trend highlights a 'buy-to-hold' buyer profile, with high-net-worth individuals purchasing homes primarily for personal use rather than resale. The total value of homes worth over $10 million sold during H1 2024 reached $3.2 billion, building on the $7.7 billion recorded in 2023.

The Palm Jumeirah led the luxury market with 21 deals worth over $10 million, totaling $365 million and accounting for 26% of sales by total value. Emirates Hills and District One followed in second and third places, respectively.

Strong Demand for Ultra-Luxury Homes

Demand for ultra-luxury homes priced above $25 million remains robust. Will McKintosh, Regional Partner and Head of Residential, MENA at Knight Frank, highlighted significant growth in this segment.

"The number of ‘over $25 million’ home sales grew by 25% in the last three months alone, bringing the tally for the first half of 2024 to 21,"

McKintosh said. This is a remarkable increase compared to the average of fewer than three sales per year between 2015 and 2021.

Dubai’s prime residential market continues to thrive despite a significant supply shortage, driven by strong demand from global high-net-worth individuals. The city’s luxury real estate sector is set for further growth as it attracts more international capital.

Total number of $10m+ homes sold in Dubai

Breakdown of $10m+ home sales in Dubai during H1 2024

 Total value of $10m+ homes sold in Dubai in H1 2024

Total number of $25m+ homes sold in Dubai

Total number of $10m+ homes sold globally (Q1 2024)

Total value of $10m+ homes sold globally (Q1 2024)

News Source: Gulf Business