High-net-worth-individuals (HNWIs) around the world are prepared to spend $4.4 billion on residential real estate in Dubai, says a new report.
According to Knight Frank’s 2024 Destination Dubai report, which surveyed 317 high-net-worth individuals (HNWIs) – 217 globally and 100 GCC-based expat HNWIs, the respondents collectively have a net worth of $5.4 billion and own 1,147 homes worldwide.
Dubai’s allure for global HNWIs
“Dubai has taken pole position as the most preferred emirate in the UAE for HNWI’s globally to purchase real estate,” the report noted.
It added that,” Abu Dhabi ranks second overall, while Sharjah has secured third place this year.”
Faisal Durrani, partner, head of research, MENA, Knight Frank, said: “Dubai remains the number one destination for the global HNWI community. Not only has the city cemented its status as the busiest $10 million+home sales market in the world, but HNWIs continue to clamour for the ‘Dubai life’ and property at the upper echelons of the price spectrum in the emirate is a hotly contested commodity.”
Factors driving HNWI real estate demand in Dubai
“This segment of the market is what truly dictates how prices across the mainstream market behave. Last year, total residential transactional volumes approached a record 120,000 deals, worth around $95 billion, yet $10 million+ home sales accounted for only 8 percent of this figure, by total value of sales,” he added.
According to Knight Frank, Dubai’s prosperity has been fuelled by its transformation into a global commerce hub over the last 50 years. This, coupled with investments in infrastructure, and a focus on social mobility, has fostered a continuously rising standard of living and exceptional public safety. “Overall, the city’s high-quality infrastructure ranks as the number one factor that makes Dubai an attractive place to acquire real estate, according to the 317 HNWI that we surveyed. Indeed, the UAE’s infrastructure quality was ranked fourth globally in the World Economic Forum’s (WEF/Davos) 2023 competitiveness report published this January,” said Durrani.
Read more: Dubai’s residential segment thrives with 24.7 percent annual growth in Q1 2024: Report
Evolving preferences of HNWIs in Dubai
Knight Frank pointed out that Dubai’s residential market had evolved over the last two decades to offer ‘destination communities’, each with unique offerings and pull-factors, designed to cater to the city’s international expat community. While many facilities and amenities such as schools, community malls, clinics and sports facilities have become the norm, there has been a rise in demand for homes with access to green space, or parks, it stated.
For her part, Shehzad Jamal, partner, Strategy & Consultancy, MEA, Knight Frank said: “Access to green space, or parks has emerged as the number one consideration for HNWIs eyeing up a property purchase in Dubai. Indeed, 88 percent of HNWIs have named this as a potential deal breaker when weighing up property options in the city.” He also noted that the growing global focus on personal well-being is exemplified in the desire for HNWI to be located within close proximity to a clinic or hospital, which has emerged as the second most important property selection criterion. Similarly, access to the beach has been cited as the third biggest selection criteria.
Market dynamics and outlook
“The juxtaposition of wanting access to green spaces, while also living by the sea offers a clear blueprint to developers of what will most likely capture the attention of the global elite,” Jamal noted. And with just 368 homes planned in Dubai’s prime areas, the market is falling well short of current demand levels, which is of course, is also supporting the sharp price rises recorded at the top-end of the market, he added.
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