Lavish growth
Dubai’s luxury property segment is booming, with price no criteria for the right residence
These past six months have been filled with superlatives in Dubai’s luxury property market, from incredible new properties coming on the market to record-shattering transactions. After the rollercoaster that was 2020 – from fears of the market plunging into chaos in March to the shattering of a seven-year record in November – we had predicted that 2021 would be the year of super prime real estate. Thus far, the year has not only met that prediction, but greatly exceeded it.
Looking at super prime properties, there were 22 homes worth Dhs35m or more sold in the first five months of this year, a volume not witnessed since 2015. In fact, in April, 3 per cent of the Dhs10.97bn in sales recorded in Dubai’s property market were at a price point of Dhs10m or higher. It is a great time to be in the penthouse market, with units in One Palm and W Residences proving to be quite popular. As projects such as The Residences Dorchester Collection and Atlantis, The Royal Residences get closer to completion, we are seeing very high levels of buyer interest in them as well.
Villa sales across the city have been particularly robust, with data released by Property Finder revealing that one in three properties sold in the first quarter was a villa or a townhouse.
Palm Jumeirah has been a hotbed of activity, and some of the best frond villas have been disappearing off the market with remarkable speed. I was very delighted to be involved in two of this year’s most expensive sales so far – both on Palm Jumeirah with a selling price north of Dhs100m each. These transactions occurred within a few weeks of each other, and really highlighted how quickly that segment of the market is moving right now.
There have also been other transactions at a comparable level for other frond villas in Palm Jumeriah and in areas such as Dubai Hills Estate. We have been fortunate to end H1 with the sale of a magnificent custom-built villa for an undisclosed sum – as a matter of discretion, I cannot reveal further details at this point.
But what we are seeing is that buyers who are very keen to purchase a property in Dubai are not put off by the price. The city has become something of a safe haven during the pandemic, offering a welcome respite from the rolling lockdowns
“FAR TOO OFTEN, SELLERS HAVE BEEN BURNED BY BROKERS WHO BRING IN UNQUALIFIED CLIENTS, TRYING TO PUSH A DOWNWARD NEGOTIATION ON PRICE AND OFTEN LEADING TO UNREASONABLE OFFERS”
that continue to pop up across Asia and parts of Europe. Anyone who frequents Dubai – even for a few months a year, is now looking to call it their home. And at prices that are far cheaper (and offer far greater value) than what you would find in London, Monaco or Hong Kong, there is no better time to buy.
MUM’S THE WORD
Discretion has become more important to our selling clients than ever before in 2021, especially those who are at the higher end of the market. Owners of high-end properties who wish to sell are increasingly preferring to keep their home out of the public eye, marketing them exclusively with one agent.
Far too often, sellers have been burned by brokers who bring in unqualified clients, trying to push a downward negotiation on price and often leading to unreasonable offers that cause a deal to fall through and extend the selling timeline of the property. By being more selective about who they work with and limiting the exposure of their property, sellers are able to ensure that only qualified clients walk through their door, which in turn greatly increases the chances of selling at the asking price.
Our Private Client Office is a division of the company that caters specifically to our most high-end clients, and we have been approached by quite a few sellers over the past few months who wish to keep their properties off the market. Working alongside them, we can create a tailored marketing plan that aligns with their goals and their timeline for selling the property. We also follow a very rigorous qualification process for potential buyers to weed out window shoppers and discount seekers.
OUTLOOK
It is predicted that property prices will rise for the first time in six years, which is a shift that we had expected to happen last year, before global circumstances changed.
The property market in Dubai has always been resilient, and I think it’s fair to say that everyone was surprised at just how quickly it bounced back in the latter half of 2020.
Looking ahead, I do not see any slowdown in activity over the short to medium term at least, and it is safe to say that our Private Client Office will be especially busy dealing with both highend buyers and sellers to produce a few more record-breaking transactions before the end of the year.
The UAE has recovered faster than most countries from the early days of the pandemic. The work here has been outstanding, with precautionary measures in place and a successful nationwide vaccine rollout. This has attracted many people from around the world to relocate to the UAE and enjoy a more stable lifestyle.
In line with that, 2021 has been an excellent year for the Dubai real estate industry. We now have good momentum from a strong market rebound in all real estate segments – residential,
rental and off-plan.
Over the last 12 months, strong demand for villas and townhouses has caused a huge upward trend, with apartments expected to follow this trend in the second half of 2021, especially in prime areas such as Palm Jumeirah, Dubai Marina and Downtown Dubai.
This year, all of the major property developers in Dubai including Emaar, Damac, Dubai Holding and Majid Al Futtaim have had very successful new launches, with units selling out fast in communities such as Emaar Beachfront, Arabian Ranches III, Damac Hills, Port De La Mer and Tilal Al Ghaf. Dubai developers are offering apartments and villas on attractive payment plans to new investors from all around the world.
There is also a wide range of inventory of excellent off-plan properties to choose from, ranging from modern beach/waterfront homes to new contemporary villas in the suburbs, right next to a championship golf course.
New properties and communities are constantly evolving and improving. Developers are providing modern designs and better amenities, reducing the high costs of property renovation. Over the next four to five years, many of the original residential communities will be surpassed by areas such as Dubai Hills Estate and Dubai Harbour. These are now the major hotspots for investors and future end-users.
Planning to relocate or move cash/wealth to Dubai has never been more attractive. The opportunity to purchase a premium asset/property in a prime area of the city is now very easy and affordable. This kind of a real estate market will always appeal to investors on a global scale.
We have already seen a huge influx of overseas investors moving into Dubai in 2021 and this will most likely continue. Many countries in Europe are still suffering because of a lull in tourism and a dull post-pandemic economy. Economists continue to warn of an increase in inflation, therefore many investors are opting to shift their portfolios to the real estate market in Dubai.
During these extraordinary and uncertain times, there are not many countries around the world that can offer:
• Safety and security
• Excellent infrastructure
• Tax-free, stable economy
• Capital appreciation and strong yields
• High-quality lifestyle for all nationalities With the continued success of real estate in 2021, the best way to predict the future is to build it. Therefore, the best plan is off-plan.