DUBAI, UAE — For the first time ever, real estate sales in Dubai got off to their best possible start for a calendar year. According to Dubai Land Department, the city saw a record-breaking rise in real estate sales in the first two weeks of 2023, with a total of AED13.22 billion transacted across 4,275 separate deals.
Sales of record amounts in the Dubai real estate market are indicative of the market’s maturity and the maturity of its numerous real estate goods.
While the industry typically experiences a slowdown over the summer and holiday seasons, this year’s strongest annual start occurred during the first two weeks of the year when things are traditionally quieter. This resulted in nearly double sales compared to the same period in 2022.
Although starting from a very low point, research made by Frank Knight states that in 2022, the Palm Jumeirah, Emirates Hills, and Jumeirah Bay Island real estate markets in Dubai all had record growth in residential values. In addition, Knight Frank forecasts that Dubai will be in 13.5 percent of the world’s important residential markets in 2023. This follows the predicted 50 percent increase in the cost of luxury homes in 2022.
Despite this, Dubai is one of the “cheapest” luxury housing marketplaces in the world, with prime pricing at AED 3,200 per square foot, or roughly US$ 850 per square foot. In 2022, the most expensive Burj Khalifa apartment sold for roughly AED 4,000 per square foot or about US$ 1,100 per square foot.
In 2022, off-the-plan sales accounted for approximately 55 percent of the overall volume of sales, up from 44 percent the year before and 56 percent of the total sales value, up from 41 percent. Continued expansion is anticipated, with more than 88,014 transactions reported by the Dubai Land Department between January 1, 2022, and December 1, 2022—a growth rate of over 60 percent compared to the 54,674 transactions recorded in 2021—it’s clear that foreign demand is propelling Dubai’s luxury real estate market.
In November of 2022, the value of off-plan sales of residential property hit a record high of US$ 3.7 bn, up from US$ 2.1 bn the previous year.’
Since November 2021, the number of transactions involving luxury flats has increased by approximately 74 percent, reaching around 8,000. Customers today desire higher-quality properties. Therefore, the old idea that off-plan homes are cheaper than move-in ready has changed. Much, in spite of the potential for greater expenses because of its settings within green spaces, unique architectural ideas, high-quality building materials, and solutions based on the notion of sustainability.”
According to the Frank Knight analysis, the relative resilience and outperformance of Dubai’s housing market are highlighted by the apparent ongoing upward trajectory in home values in Dubai against the backdrop of weak global macroeconomic data. Downtown Dubai is quickly becoming a hotspot for internationally appealing “cheap” luxury real estate.
Demand for the world’s tallest building remains high, in line with the city of Dubai as a whole. In reality, in 2022, Burj Khalifa accounted for 3 percent of all sales in the city center, which totaled 15.6 billion dirhams, with 94 apartments selling for more than 477 million dirhams.
With the strong and expanding presence of modern real estate projects, major real estate developers in Dubai are shifting the city’s real estate away from Mediterranean-style residences. This is because there just aren’t enough suitable houses on the market to satisfy both domestic purchasers and their international counterparts. These houses are distinguished by their heavy reliance on cutting-edge building materials and techniques, such as glass, opulent modern finishes, and innovative architectural layouts that challenge the stereotypical connotation of a home.